The future is now. In our technological landscape, digital assets can comprise a large amount of your estate. Despite this I am routinely seeing wills that were drafted in the last 10 years which either completely fail to address the issue of digital assets or throw them in as an afterthought with no attention or care. To make matters worse, the laws in this area are still being developed and as such your heirs cannot rely on the court system to give them much help in this regard. Additionally, the procedures for accessing a deceased persons accounts are far from homogenized across the different sites, and so even when the will provides for access, this access may be frustratingly difficult to achieve.
Simply put, having the current and correct username and password is the only guaranteed way to access these sites in a timely and efficient manner.
Having a list with sitenames, usernames, and passwords is essential for your executor and heirs to be able to find, acquire, and manage your digital assets. But there are several ways to compose and manage such a list and they have varying degrees of reliability.
The problem with only including the site/user/pass as a physical list with the will is that often the will is drafted years and even decades before a persons death. During the ensuing years, new accounts will be created and passwords will likely be changed. Think about the digital accounts you had ten years ago, are they all still the same ones you have today? Would the same passwords still work? It is clearly a problem. There are several potential ways to deal with this issue though.
One way is to put a provision in the will that a regularly updated list of site names and passwords will be included with the will as a separate document and that the executor is expected to follow this list to access all accounts. This requires the testator to actually manage and update this list on routine basis and also to be sure it is stored alongside the will. If the will is kept in a safety deposit box at a bank for example, then updating this list can become something of a hassle.
The easier, and more foolproof method is to use password management software. You may already use password management software in your day-to-day life but it also works as a surprisingly effective estate planning tool. For those not in the know, password management software stores username and password information for as many sites and accounts as you want. Additionally, when you go to a site that has been saved into the software, you can configure the password management software to automatically type in your credentials. You access the password management software with a master password (and it is critically important that this master password be as strong as possible) so you can access all your accounts from any device that you are on. As such, in the section of your will that addresses digital assets, the drafting attorney can insert a provision that gives the executor access to the master password and all sites and information contained within it. This means that if you signed up for a new email account the day before you died, your executor would still be able to access it with the master password contained in your will.
A password management system will give your executor fast and easy access to online bank accounts, brokerage accounts, paypal, bitcoin wallet, etc. In addition to financial accounts, most people own some sort of valuable intellectual property on the internet. This may be as simple as a business URL, but your successors to that business will want the correct information and access to easily renew that valuable URL.
Additionally, site names and passwords are often necessary to fully and properly wind down or restructure a business. It could be a hassle if you are still listed as the main contact person for a company after your death, and your heirs may miss important messages which are not being directed properly because your linked in page for example was not updated to reflect that you are dead and as such (hopefully) no longer involved in the day-to-day operations of the business.
This isn’t just about money though. Just as, if not more importantly, are digital photos and videos. The days of photo books and scrap books are largely gone. Now most of our memories are stored digital and may not be currently present in any tangible medium. Site names and passwords will allow your heirs to locate and download high definition copies of these photos or videos that you have uploaded that may be on several different sites or storage spaces and with different passwords for each.
In this day and age, digital assets should be a central focus in your will and estate plan. By staying current with the technological landscape you and your attorney can properly plan for the future.