Real Life Planning Podcast Episode 32: How to Create an Estate Plan for Your Online Accounts

In Episode 32, I speak about the importance of having an estate plan for your online and social media accounts in case of an emergency or when you pass away.

“...digital estate planning is really an essential component of a well constructed estate plan.” - Cynthia Meyer

This week on Real Life Planning Podcast:

Takeaway Quotes:

“ …doing this is a gift to any people that you would leave behind. In the case of an emergency, it can absolutely be a lifesaver to keep your business or your online presence alive. - Cynthia Meyer

“Your digital estate plan is going to tell your digital executor, whether that's the same or different person than your regular executor, what should happen to your online assets.” - Cynthia Meyer

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About the Real Life Planning Podcast

Host Cynthia Meyer welcomes fascinating guests to share real life stories of how they are realizing their financial potential. Each episode explores practical, realistic steps to create results.

Transcript for Episode 32

[00:00:11] Recently, my dad passed away and in the process of getting everything resolved- getting bills transferred to my mom's name, figuring out where my dad had accounts; the social media accounts. He had a really robust digital life. And figuring out what happened after he passed away was pretty confusing.

[00:00:35] Like who can pay the bills? How to shut off automatic debits? Does it count? It was cumbersome. As a financial planner, I invite clients to think about planning for some of these things in advance; either for contingencies or actually as part of the estate planning process.

[00:00:53] And so today on the Real Life Planning Podcast, I'm talking about digital estate planning; giving you some suggestions about how you can get it all done in one day.

[00:01:02] We've all had this situation where maybe we've been on LinkedIn, for example, and we get a request to endorse a friend or a professional colleague for certain skills, for example, but that professional friend or colleague has already passed away. And what happened was is that their survivors didn't have any way to turn off their digital accounts.

[00:01:27] Digital estate planning- it's the process of making sure that doesn't happen. It's the process of answering all these questions in advance so that your survivors know exactly what you want to happen; your digital life- after you pass away. It also includes the process of planning for contingencies. Unfortunately, a professional colleague of mine recently was hit by a car when he was riding his bicycle. He's not able right now to manage the day to day work of his business. Luckily, he had an agreement with another professional to take over if something had happened to either one of them. 

[00:02:04] But still, the process of getting access to all of that online stuff has been very complicated.

[00:02:10] Bringing together a digital estate plan is really an essential component of a well constructed estate plan. An estate plan is just a list of instructions to what happens to everything that you own after you pass away. And that digital estate plan is part of an estate plan that includes other things that we've talked about before; a will to have a guardianship provision for minor children. Power of attorney for finances. Power of attorney for healthcare and a living will. Digital component of this is that there's not one document for it.

[00:02:47] The first step is to choose a digital executor. So a digital executor is the person that takes care of or carries out your wishes about your accounts and your online life in a way that's instructed in your estate plan. And so you identify somebody that's very trustworthy, obviously, and computer savvy to make sure that they can be your digital executor and you're going to name them in your will.

[00:03:15] Now, this could be the same person as the actual executor in your will, the person that is going to take the will to probate if needed and go to all of your account providers and update them for in the names of the beneficiaries. But it doesn't have to be, right? It could be somebody else and you've just named that person specifically in your will or trust. You want that person to handle your online life. 

[00:03:37] This is particularly important if you have an online presence for your business or you have social media with a lot of followers or something like that. 

[00:03:49] You want to pick somebody who's going to be a good steward of your online business and your online social media reputation after you're gone. So who would you want to control your website? Or your blog? Or your social media after your death? If for some reason that person wasn't available, is there a backup person? 

[00:04:08] Make sure your digital executor knows that they have been chosen as well as who to contact in the event that you pass away, or if this is part of a contingency plan for your business, for example, who to contact in the case of you're hospitalized and you cannot manage these things yourself.

[00:04:26] Preferably, while you're still around, you want to discuss with that person your goals for your online presence. What do you actually want to happen when you pass away? Do you want all your social media to go away? Do you want a memorial site? Do you want your online blog or vlog or podcast- do you want it to stay up? Do you want it to come down? Think through all these questions .

[00:04:49] So the next step is to take an inventory of your digital assets. And so if something happens to you, do people know where to find these things?

[00:04:58] So first of all, financial. So the person who is your actual executor of your will needs to know where the bank and brokerage accounts, the employee benefits accounts like your 401k or your employee stock options, credit cards, loan accounts, mortgages, student loans, et cetera. Other bills that you pay online, like your electricity or your gas or your water, or your car insurance. 

[00:05:21] This was in the instance of my dad passing away. It really took my sister and I awhile to track down everything that was auto paid and get it put in my mom's name and making sure that it was coming out of the right bank account. Things like PayPal, Venmo, Apple Pay, Starbucks, any other digital wallets.

[00:05:40] Amazon and other retail accounts, and your cell phone account. Keeping an inventory of all that, maybe if you have a safe, keeping it in your safe or just making sure that your executor knows where to find this stuff. 

[00:05:51] And then how are they going to get into the accounts? We're going to talk about this in more detail in a second, but you need to have a way for them to get access to the accounts if something happens to you.

[00:06:00] Then in the online space, we're talking about your blog or website or podcast site, your email or emails; many of us have multiple emails. Your social media- Facebook, LinkedIn, Twitter, Instagram, Pinterest, Snapchat, all of those things, TikTok, I guess now. 

[00:06:19] The music and video websites. If you've got a Spotify or Vimeo or Sonos- a subscription in your house. And then the home and office stuff. Obviously, any digital assets that you have for your business. And then what about your security system? Your computer and phone systems, your voicemail, all of those things have online access. 

[00:06:38] It's a process of gathering all that information together and deciding how you would share it with somebody in the event that you couldn't make decisions for yourself or you passed away. That process can be really nerve wracking. That's because the best protection for identity theft is to not to write that stuff down. So where are you going to store information for all of these accounts? Common way that people do this is to use password manager. There are several reputable password managers or password vaults. This allows you to create one strong password that you can remember and will also prompt you to update your weaker passwords if they're not that great, or if they, perhaps have been released in some kind of hacking thing and you didn't know about it. So you need a master password for your password vault, and then you need a way to get that master password to your digital executor or your executor in the event of a serious emergency, or if you pass away. A number of passwords vaults have systems for that. You can check those out individually.

[00:07:44] You could also leave it with your attorney. This whole process obviously has some risks. You have to choose a really trustworthy person.

[00:07:53] In any case, you don't want to just give a paper list to your attorney and have them store it in their files, because you don't know how those files are going to be stored. That really is too risky. You want to choose a site that's encrypted. You could also choose a program like Everplans, for example, which is a digital estate planning tool.

[00:08:12] Another alternative could be, you write them down and you keep them in your safe. All of these choices have a certain element of risk, but they're not as big as the bigger risk of having your entire online life locked up. Your survivors can't get the mortgage paid or the electricity paid or can't handle your business website or whatever.

[00:08:32] So then the other thing is to create some written instructions or video instructions, and to leave messages for your survivors, in particular, your executor about what you want to happen to your online life should something happen to you. So take time to write down or record clear instructions, especially for those websites and social media accounts that you control.

[00:08:57]  Your will is going to handle what you want to happen to your stuff, like your accounts. Your digital estate plan is going to tell your digital executor, whether that's the same or different person than your regular executor, what should happen to your online assets. 

[00:09:13] Should they be taken down as we mentioned before? Should they be created in memoriam? Should they be sold? Who inherits them? Who manages them? What if you had a store in Etsy? What happens to that if something happens to you? If you're like me and you have a blog and a podcast, do you want that to stay or do you want that taken down?

[00:09:29] Check the user agreements for each of these sites to make sure your wishes can be implemented and to make sure that the person that you're choosing to help you with this process- you want to make sure that your wishes are very clearly outlined so that it happens the way that you want.

[00:09:46] As we've talked about before estate planning is the heart of financial planning that nobody really wants to do; even financial planners. We all resist a little bit the idea that we should be regularly updating our estate plan.

[00:10:00] Nobody wants to think about it. It's completely understandable but doing this is a gift to any people that you would leave behind. In the case of an emergency, it can absolutely be a lifesaver to keep your business or your online presence alive.

[00:10:17] Any thoughts or questions, leave them below. Please subscribe for notifications of future video podcasts.

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