Estate Planning for Digital Accounts

E-statements?  Be sure to make a record of your accounts!

If you’re like me, you probably have most of your financial, insurance, and other accounts set to provide statements and communications to you electronically, rather than in paper statements.  This is a great way to reduce clutter, allow access to those items from anywhere, and reduce your environmental footprint.

The problem with using electronic statements is that, when a person passes away, surviving family members may be unaware of the existence or provider of those accounts.   In the past, family members could simply check the mail during the month or two following a person’s death or incapacity and discover what accounts existed through paper account statements.  Today, that is often not possible.

In order to ensure that your loved ones are able to learn about and access your accounts after you’ve passed, create a log of your digital accounts, including the website address and (if the account is not registered under your true name) the username for each.   There are a number of free, secure websites that you can use for this purpose such as lastpass.com, passwordsafe.com, or passpack.com.   These sites also allow you to store passwords, but be aware that most websites prohibit anyone but the original user from logging in.  Also, it is not advisable to allow others to make changes or transfer funds on their own after you’ve passed on or become incapacitated.  Such tasks should only be done through probate or other legal process so that assets and debts can be accounted for and administered in accordance with your estate plan and Minnesota law.

Once set up, you can keep the username and password for the site in a safe location, such as a safe deposit box, where it can be found if anything should happen to you.  A lower-tech alternative is simply to maintain a spreadsheet of accounts that includes the name of the institution holding the account (e.g. “Target Card” or “US Bank Savings”) and web addresses.  Be sure to keep the spreadsheet in a location that is secure, but that loved ones  are aware of, such as a safe deposit box.

Take the time to create a log of your digital accounts.  Doing so will give you peace of mind and help reduce stress and frustration for your family if anything should happen to you.