What to do about passwords in an estate plan

Some North Carolina residents who are creating an estate plan might not have considered what they need to do to ensure their executor or family members have access to any online accounts. The estate planning world is slowly catching up to the digital world, but there is still no standard procedure in place for sharing passwords.

In fact, for security reasons, people are encouraged to neither share passwords nor write them down. A person who has passwords saved on a computer might give that password to an executor or other individual who can then access bank accounts and other important information. However, this is still not very secure. Some people write down all their passwords and place them in a safe deposit box, but these lists tend to become outdated quickly because people find it too burdensome to return to the bank every time they change a password.

Another solution is a digital wallet. These services store all passwords so that only one needs to be memorized. This single password could be one that is easily remembered by the owner and by others who might need to gain access, including the executor. This kind of solution is increasingly important as more information moves online.

Executors and other fiduciaries may be overwhelmed not just by the process of tracking down digital and other assets but by the entire process of managing the estate. However, they are permitted to hire legal and financial professionals to assist them. In some cases, there may be both a trust and a will. The will might be what is sometimes called a “pour over will”, which is designed to place any remaining assets in a trust. In other cases, there may be a relatively simple estate, but there are still certain documents and paperwork that must be prepared.