An individual’s estate is comprised of everything that they own. Many New Jersey residents fail to realize that in addition to tangible possessions and investments, their estate planning should also includes digital assets such as online banking accounts, passwords, e-mails, etc. While one may not believe that their digital assets hold value, including information regarding their online estate in their living will can make accessing and handling these accounts easier for those left behind.
According to the Pew Internet & American Life Project, nearly 40% of individuals over the age of 45 do their banking online, and millions of Americans store financial records online locked behind passwords. The problem with online accounts lies in the fact that one spouse often handles the family’s finances and the other spouse is unaware of the location of the account information and passwords. This could cause problems if the partner who handles all of the online activity for the family were to pass away.
For example, this spouse may have been the only one with knowledge of the user names and passwords to online banking accounts, utility bill accounts, etc. This makes the grieving process that much more difficult to the party left behind. This heartache can be avoided by ensuring that one’s living will includes access information to important accounts.
A virtual estate isn’t limited to online financial transactions. Digital assets could include an online business to a money-making blog or social media pages. When a surviving family member does not have access to these online accounts, a court order or the hiring of a computer forensic expert may be necessary to gain entry.
The true or perceived value of digital assets is not the most important factor in including them in the estate planning process. The critical issue is that the person or people whom you select to administer your estate is aware of the existence of these assets and has the information and authority required to access them upon your death. If left unaccounted for, some financial accounts could remain be frozen, leaving heirs without the ability to access their inheritance.
Given the importance and complexity of estate planning, many New Jersey residents turn to professionals to advise and guide them through the process, taking comfort in the knowledge that their loved ones will be fully protected and informed at a time when they need it the most.
Source: Smart Money, “Protecting Your Virtual Estate,” Tania Karas, July 25, 2012