Your Digital Inheritance?

eldavojohn writes "I wrote a journal entry musing on the idea of passing on accounts and digitally stored information from generation to generation. Has anyone done this or inherited anything? Does anyone else plan to do this? Is there a slip of paper in your deposit box at the bank with websites, account names and passwords?"

Comments

A current topic for me

[linuxwrangler]

My mother died a few years ago and my father died last year. Fortunately death wasn't a taboo subject in our family and also my parents believed in preparation. My father left us a document detailing all of his accounts, the web sites associated with them, the logins and passwords, etc. There were a couple of gaps but it was mostly complete. He had also detailed the relevant stock prices as of my mother's death which saved a lot of time in tax preparation and allowed us to quickly identify which assets should be sold to limit tax liability.

My parents had established trusts which vastly simplified handling of the estate. I had transfered his memorial society membership and pre-selected a cremation facility so when he died, we just had to make one phone call and transport, cremation, death-certificates, etc. were all handled.

Still, the whole death thing has been a learning experience.

When things have been done correctly, handling things is a breeze. The house and larger accounts were in the trust and we were properly named as successor trustees on the accounts. Disbursing them was simply a matter of providing a death-certificate, disbursal instructions and a couple signatures.

When the Ts aren't crossed and Is not dotted, things are more of a problem. My father had a small checking account on which he forgot to list beneficiaries. Although it amounts to less than 0.1% of the estate it was more work to deal with than the large accounts.

Email and electronic access presents an interesting problem. Just try to close a paypal account when you don't have access to the email of the deceased. Fortunately, I had my dad's laptop (and he was using my email server to handle his mail) so I was able to "forget" the password and ultimately to cancel the account. It also allowed me to unsubscribe from his mailing lists and made it easier to transfer control of various web accounts.

Check caching is a pain, too. Turn in your FastTrak transponder, cancel the landline, insurance, cell service, internet service, etc., and submit final insurance claims. Suddenly you will get a bunch of checks made out to the dead person. When you notify financial institutions that a person has died they freeze the accounts and cashing checks made out to the deceased is an exercise in paperwork. You also have to track down things that are on autopay. Then when you cancel them you may ultimately find money appearing in accounts that you thought you had closed. While not "legal", I was told by an attorney that things are a lot easier if at least one financial institution doesn't know the person is dead. Tell them only after you have deposited all the checks.

My advice....

If you care for your loved ones, take a moment in the next couple days to make a list of all of your accounts. Then verify the beneficiary information on all of them.

Make funeral arrangements. In our family this was easy since none of us are into forking over cash to the "death mafia" and so have opted for the least expensive cremation available through the local memorial society. When my neighbor died (expectedly at 90+), her son suddenly realized that he didn't know what to do next so he called the fire department. It's nice to have things pre-arranged so you aren't stuck thinking, "now what am I supposed to do" at an already difficult time. It also makes you less vulnerable to fast-talking funeral arrangers.

If you have assets in excess of $100,000 (in California, anyway), establish a trust. And assets != net worth. You may owe $599,000 on your $600,000 house but the asset still exceeds $100,000 and your loved ones will have to slog through probate which is a royal pain involving $$$, lawyers, courts and time. It's also all open to the public. With a properly drawn trust your successors may not need a lawyer at all and your business will stay private. (We have an attorney for the occasional question but have handled nearly all the estate ourselves.)

Given the overwhelming amount of time required just to deal with a house and two lifetimes of collected stuff, I'm extremely thankful that we aren't dealing with probate, too.