Estate planning does not have to be a complex and time-consuming process. Unfortunately, certain mistakes can complicate matters for your loved ones after your death. Passwords are a common problem during the estate planning process.
Chances are, you are like most people and have various online accounts. You could have online banking, Bitcoin wallets, and other digital assets that are locked with passwords. Since you cannot provide these passwords while incapacitated or dead, it is important to make sure they are accessible after you are gone.
What can happen if your digital assets are inaccessible? The case of Matthew Mellon, a banking heir, is a classic example. In 2018, Mellon died in Mexico while on his way to rehab to treat an addiction to opioids. Mellon had millions in cryptocurrency assets at the time of his death. Unfortunately for his estate, no one could recover the passwords to the various cryptocurrency accounts.
Mellon’s case is an extreme example of what can happen if your estate cannot access your digital assets due to lost passwords. However, it is a common problem as many services, including banking services, are now available online.
What Should I Do With My Passwords?
- Keep track of your online accounts. You should keep track of your online accounts and passwords. After your list is complete, then you can then store the information with an attorney or executor. Indoor safes are sometimes used to store hard copies of this information. You can provide your attorney or executor with the combination.
- Make sure to list everything. You will need to list more than just online bank accounts. Be sure to list the passwords for your computers, email accounts, contact information, mobile phones and other online services.
Some people also use cloud-based password services. There are risks associated with using these services. If you are thinking about using a cloud service to store your personal information, then you should talk to an experienced attorney beforehand. An attorney could help you look at options that are more secure.
Password storing services are also available on your desktop. However, the same risks mentioned above may apply. A good rule of thumb is to assume that digital information is capable of being compromised.
Using Power of Attorney for Digital Assets
You can include digital assets in your estate plan. This means you can grant an attorney the power to handle and distribute your digital assets to beneficiaries. Your attorney can also help you safeguard your personal information. By using financial power of attorney and including digital assets in your estate plan, you can make the process easier for your beneficiaries.
Contact Our Centennial Estate Planning Lawyer for More Information
Suzy Nelson is a Colorado estate planning lawyer who can help you establish a trust and will. For more information on estate planning in Colorado, please contact Suzy for a consultation. You schedule a consultation with the Law Office of Skipton Reynolds, LLC, by dialing (720)613-2633 or by using our online case review form.