Help Your Loved Ones by Keeping a Record of Online Accounts and Passwords
These days, we increasingly manage our financial and social lives online. Many of us pay our monthly utilities and credit card bills online as well as receive paperless bank statements. Much of our communication with friends and family is through email or Facebook. Often we opt out of receiving paper statements or bills from our banks, credit card companies, or utility companies.
Almost all of us have been warned not to write down our online passwords or account information. Our passwords should be difficult for people to guess. While this may be good advice when attempting to prevent access to online information by those looking to profit from or steal it, these precautions could have the unintended consequence. Your spouse or other agents, should you become incapacitated, may be locked out from being able to access these accounts for lack of a password. This would also be true for the executor of your estate or the successor trustee of your trust when you pass away.
Conducting financial and personal business online may be convenient now. But, the lack of a paper trail may create a hassle for your loved ones later if you haven’t provided them with the necessary information to access your online accounts. Hopefully you have done some planning for when you are incapacitated or ill enough that you need help. That is generally done by signing a durable Financial Power of Attorney and a Healthcare Power Of Attorney stating who will help you manage your affairs. However, these people will be unable to help you if they do not have access to your email or online accounts. Without paper statements they are unlikely to even figure out if any bills are due, much less be able to pay them. They may not even be able to access your computer if you log in with an ID and password. In addition, when you pass away, one of your executor’s responsibilities will be to determine where your assets are located. They will need to do this to be able to pay your creditors and distribute your assets to your beneficiaries. If your executor is unaware of or unable to access online bank accounts or investments, this will complicate matters, increase the expense, and generally make life more difficult for that person. In addition, a lack of the online information may ultimately lead to your beneficiaries losing out on those assets.
So, how can you implement a safe, practical solution for storing online account information and passwords?
- First, create a list of your usernames, passwords, and PINs. Be sure to include information about how to access the following:
- Your computer(s)
- Email accounts
- Financial sites, such as banks
- Mortgage providers
- College savings and retirement plans
- Companies where you have set up automatic bill-paying, including subscriptions that will automatically renew and charge your credit card or bank account
- Social networking sites, such as Facebook, Twitter, and LinkedIn
- Photo storage sites
- Cell phones
- Next, store your list of online account information in a safe location where it can be updated as needed and accessed by your advisors and loved ones if necessary. At Weatherby & Associates, PC, our LifeBridge™ clients have access to our Document Vault, a website with bank-level security where they can store copies of important documents, as well as online account information. Clients are able to maintain all of their important information in one place and can also allow their agents and advisors access to their Document Vault.
The following actions are not safe or practical ways to share your online information:
- NEVER list your usernames and passwords in your will. A will becomes a public document when it is filed with the probate court after your death and anyone can access it.
- If you have a living trust, do not list your usernames and passwords in your trust. Although a trust is not a public document like a will, your passwords and online accounts can change often, so it is not an optimal solution for giving your agents access to up-to-date information.
For more information regarding how to manage your online account information, or for help with other estate planning issues, contact our office at 888-822-8778.
