Much of our lives are lived online these days, but people still forget their digital assets when it comes to estate planning.
A BMO Wealth Institute survey on the subject found members of the Baby Boomer generation generally recognized the importance of digital assets and access to them after death. Yet even among this group, 57 per cent failed to account for them at all in their wills.
But the consequences of omitting this relatively new class of asset from an estate plan can be both financially and emotionally devastating for the friends and family of the deceased.
Although some foreign jurisdictions have started drafting legislation that deals directly with estate trustees’ rights to access and take control of online accounts, the laws in Canadian provinces and territories don’t offer much guidance.
Privacy protection rules often require a court order before key information can be turned over about a deceased person’s account, and it can cause big problems if an executor is locked out of online bank accounts.
With social media sites, the headaches tend to be more emotional than financial for those left behind. Each site has its own policies, but Facebook gives users the option to permanently delete their account when they die, or to maintain a memorialized version for supervision by an appointed legacy contact.
Otherwise, it can be very upsetting for family members to watch messages accumulate on their loved one’s profile without the ability to respond, or to delete inappropriate comments.
That’s why I prompt new clients to make a list of all their digital assets – including social media profiles, email accounts, online banking and even loyalty points – as well as the passwords associated with each.
Obviously you don’t just want to have a list of all your passwords lying around for someone to find, but you can deposit the details with your lawyer or another trusted person for safekeeping, along with instructions for their use following your passing.
That’s generally a better option than a safety deposit box, where the bank’s strict access rules following death of the owner may hold up the process for heirs.
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