Your Heirs Will Need Your Passwords! - Rodgers & Associates

Your Heirs Will Need Your Passwords!

Do you still get financial state­ments by mail or are most coming electron­i­cally? What would happen to that infor­mation if you were to die or became incapac­i­tated? Would your loved ones be able to access your accounts or even know where your accounts are held? This year’s Insights on Wealth and Worth report (PDF), published by US Trust, said 45% of the high-net-worth people it polled had not organized passwords for electronic account infor­mation, yet 87% said they knew the location of important documents and most had a will. Why do so many people fail to organize their passwords?

It’s not because there is a lack of websites and tools for storing passwords in digital vaults. Many people claim constantly changing passwords is the reason they’ve done nothing. However, recording this infor­mation for your power-of-attorney (POA) or executor is just as important as updating your will. Your estate plan needs to have a digital component to assure every­thing goes smoothly. Maintain a list of your online accounts, along with the user names and passwords to access them. Be sure to include answers to your security questions, if applicable. Make sure your POA and executor know where this infor­mation is kept. Finally, update the infor­mation regularly.

This is time-consuming (to be sure) and can seem overwhelming to get started. However, once the list is created, it can be kept up-to-date easily by exercising some disci­pline as passwords are updated or new accounts estab­lished. Find a secure online vault where this infor­mation can be uploaded and stored. This avoids the chance of losing your infor­mation to a hard drive crash.

Taking the time to save this infor­mation can save your heirs time and money, and can avoid the chance of an account being overlooked because no one knew it existed. Otherwise, your executor may have to visit financial insti­tu­tions with a death certificate and court appointment documents to prove they have authority to access your infor­mation.