If someone else gains access to one of your digital accounts, it can cause severe problems. The account does not even need to be a financial account. Someone hacking into a social media account can also cause a lot of damage. For this reason, people often go to great lengths to secure their accounts as well as they can from anyone else gaining access to them.
After we pass away, we may want someone to have access to those accounts, so they can wind them down or preserve any information in them. This creates a conflict that can be difficult to resolve.
There are three basic complications when it comes to planning for someone else to access your digital accounts after you pass away, as the New York Law Journal discusses in "Protecting Digital Assets in a Digital Age," including:
- Passwords -- You probably do not want to give anyone else the passwords to your accounts now. However, someone else will need them, after you pass away. This requires having a secure plan.
- Encryption -- Increasingly, many digital accounts have heavy encryption. Someone who knows how to work with encryption is, therefore, required to handle your accounts, after you pass away.
Work with a qualified estate planning attorney to make sure you cover all the bases.
Reference: New York Law Journal (May 4, 2018) "Protecting Digital Assets in a Digital Age."