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The Digital Estate Checklist Grows

11/11/2023 - Financial Wellness & Life Planning

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Updating your will every few years is a great idea, and there are many additional things you can do to make it easier for your executor and create a smoother transition of assets. One of those things is to address digital assets.

Our digital footprint keeps growing, and access to it is becoming more complicated. Digital assets can be personal, such as email and text messages, photos and videos. They can involve interactions on social media platforms and the identity created on those platforms. They might be financial accounts online, including bank accounts, virtual currencies such as bitcoin or NFTs. More and more things are going digital, and there isn’t a unified way to address them after death.

There are many reasons to try to protect and transition these assets in an estate. From the simplest one of reducing the chance of identity theft after death and making the job of the executor easier, to complex histories and stories that could become lost or inaccessible. It is estimated that billions of dollars-worth of crypto-currency have become completely inaccessible due to forgotten passwords.

Many companies have added two-factor authentication and biometric sensors in order to increase security. Although this is great for everyday life, it can be a problem for executors without the fingerprint needed to log in. Some companies have taken steps to deal with executors directly. For example–when it comes to an Apple ID there are two ways to go about getting access:

If you don’t plan ahead, you can request access with a court order.

On Apple’s website they state that:

  • “Where applicable, the court order needs to specify:
  • The name and Apple ID of the deceased person.
  • The name of the next of kin who is requesting access to the decedent’s account.
  • That the decedent was the user of all accounts associated with the Apple ID.
  • That the requestor is the decedent’s legal personal representative, agent, or heir, whose authorization constitutes “lawful consent.”
  • That Apple is ordered by the court to assist in the provision of access to the decedent’s information from the deceased person’s accounts. The court order should be addressed to the relevant Apple entity.”

If you do plan ahead, a legacy contact might be already baked into the cake.
Apple has added the feature that someone can add a legacy contact and create an access key for them. Then they don’t need a court order, and only the death certificate as additional information. You would only need to go to the “Digital Legacy – Request Access page.”

What about others such as Venmo or PayPal or Facebook? Will they be the same?
Every company has their own specified guidelines for the executor. Some, such as Venmo or PayPal have possession of valuable assets that will be considered part of the estate, taxed, and passed along. Typically one needs the death certificate showing the account holder is deceased, and proof of the identity and authority of the estate executor.

One of the recommendations by both retirement and estate planners has been to delegate early, and create access with trusted family members to help manage these accounts. One could create a durable power of attorney to do so, but also create a password list so that those people still have access both in the case of incapacity and death. Passwords can change though, and we don’t always change them on all devices. Often, we might change a password because we forgot with one device, and then find out we can’t log in on other devices. The hard copy “password list” is something that might not get updated when resetting a password, so it can quickly go out of date.

In addition, companies may change how access is granted. More features may be added to create legacy contact options such as Apple has done (this is a relatively new option, only a couple years old), or access options might change with a new terms of service agreement. Thus, the best course of action is not just to make a password list, but revisit your digital assets and how you’d like them to be handled annually or at least every few years with a qualified estate planner.

© 2023 M.A. Co. All rights reserved.
Content is for informational purposes only and is not intended to provide legal or financial advice. The views and opinions expressed do not necessarily represent the views and opinions of WesBanco.

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