We all know the importance of having a will. Did you know that your estate should also include all your online accounts?
In her article, 5 Steps to Creating Your Digital Estate Plan, Next Avenue contributor and author Catey Hill writes about the importance of a digital estate plan, and how to set one up.
“Will drawn up? Check. Trusts created for the kids? Check. Executor of the estate named, health directives signed, and funeral arrangements specified? Check, check, and check.
With all that done, you may think your work is finished. But there’s one key facet of 21st century estate planning that many people overlook: a digital estate plan.
This plan lays out your digital assets — both financial (such as online bank and brokerage accounts purchasing and download destinations like Amazon, Apple, Netflix, and Expedia) and social (like Facebook and Flickr accounts) — and provides directions on how to access and handle them upon your death.
To help make the process simpler, Google just launched an Inactive Account Manager feature, which lets you tell the company what you want done with your digital assets on its services (Gmail, Blogger, Google Drive, Google+, Picasa, Google Voice and YouTube) when you die.
The Importance of a Digital Estate Plan
Maybe you never thought of your Facebook account, your eBay shop, or your virtual land on FarmVille as an ‘asset.’ In fact, 63 percent of people don’t know what will happen to their digital assets when they die, according to a survey by Rocket Lawyer, an online legal service.
But think about all the information and docs and apps (such as what may be stored in the cloud) in these accounts and the potential value they represent. If you’re a photographer, for example, much of your valuable work may be digital and stored in password-protected areas of your computer or in the cloud.
‘In this day and age, your digital assets should be a part of your estate planning,’ says Rick Salmeron, founder of Salmeron Financial in Dallas. ‘You need to pass on the keys to your digital kingdom.’
A 5-Step Digital Estate Plan
There are five steps to help you create a digital estate plan:
Step 1: Make inventory lists of your digital assets and how to access them.
One should have your online passwords and the other should have your online account numbers. If all that information is in one place and someone steals that list, he or she can easily hack into all of your digital accounts.
The lists might be long; you may not be able to put them all together in one sitting. (You should also have a record of your non-digital assets, as a blog post by Next Avenue Money & Security editor Richard Eisenberg explains.)
Your digital inventory could include the following:
- Your Facebook, Twitter, LinkedIn, and other social media accounts.
- Blogs and websites you own.
- Bank, brokerage, retirement plan, credit card, loan, and insurance accounts that you access online.
- Your email accounts.
- Online retail accounts and apps from stores, flash sale sites or marketplaces like eBay, Amazon, and iTunes.
- Photo- or video-sharing sites like Flickr or YouTube.
- Music sites like Pandora.
- PayPal or other online payment accounts.
- Utility bills you pay online.
- Any other online accounts such as ones from airline sites with your frequent flier miles and document and data
- Storage accounts like Google Docs
- If you use a “digital wallet” product on your cell phone — like a prepaid Starbucks app that lets you pay for your lattes from your phone — this too might be worth adding to the list.
Try to update these inventories at least once a year — or, ideally, whenever you change a password, or close or open a digital account.
More on Thursday 8/13/15: Step 2: The safest place to store your digital information
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