What’s the Password? Estate Planning for Your Online Accounts
July 22, 2020

Nearly everyone owns at least some digital assets, such as online bank and brokerage accounts, bill-paying services, cloud-based document storage, digital music collections, social media accounts, and domain names. But what happens to these assets when you die or if you become incapacitated?
The answer depends on several factors, including the terms of your service agreements with the custodians of digital assets, applicable laws, and the terms of your estate plan. To reduce uncertainty, address your digital assets in your estate plan.
Pass on Passwords
The simplest way to provide your family, executor, or trustee with access to your digital assets is to leave a list of accounts and login credentials in a safe-deposit box or other secure location. The disadvantage of this approach is that you’ll need to revise the list every time you change your password or add a new account. For this reason, consider storing this information using password-management software and providing the master password to your representatives.
Or, you can use an online service designed for digital estate planning. These services store up-to-date information about your digital assets and establish procedures for releasing it to your designated beneficiary after your death or if you become incapacitated.
Know the Law
Although sharing login credentials with your representatives is important, it’s no substitute for covering digital assets in your estate plan. For one thing, a third party who accesses your account without formal authorization may violate federal or state privacy laws.
In addition, most states have laws that establish default rules regarding access to digital assets by executors, trustees, and other fiduciaries. Specifically, most states have adopted either the Uniform Fiduciary Access to Digital Assets Act (UFADAA) or the revised version of the Act; Alabama has adopted the revised version. If those rules are inconsistent with your wishes, you’ll want to modify them in your plan.
Both laws allow people to provide for the disposition of digital assets using online settings offered by the account provider. For example, Facebook enables users to specify whether their accounts will be deleted or memorialized if they die and to designate a “legacy contact” to maintain their memorial pages.
Both laws also allow people to establish certain rules in their wills, trusts, or powers of attorney. They may also allow the account provider’s service agreement to override estate planning documents and state law in certain circumstances.
Take Inventory
To ensure that your wishes are carried out, take inventory of your digital assets now. Then, speak with Attorneys Debby Spain, Russ Russell, Caty Richardson, or Sarah Johnston in Capell & Howard’s Estate Planning, Probate & Trust department about including these important assets in your estate plan.