Be honest. If something were to happen to you tomorrow, would anyone know how to access your bank accounts or the multitude of other accounts you likely have?
For many, they are the only person who knows about all of their accounts, and the only one who knows the user names and passwords to these accounts. While, generally, it is not a bad idea to limit sharing of these details, providing a trusted person with this information is an important part of proactively planning for the future. Below are two situations that highlight the importance of having a trusted individual who knows about and can access your accounts.
Scenario #1: You become incapacitated and can’t manage your own finances
Not being able to manage your own finances can result from a sudden health incident like an accident or stroke or from a progressive health condition like dementia. In either case, if you have a power of attorney (POA) for finances, with access to your accounts, they would be able to take over paying your bills so no accounts become delinquent. Additionally, your POA would be able to pay for any care that you may need, without delay. Also, with insight into your accounts, your POA would know what support and care you can and cannot afford.
[If you don’t have a POA and don’t have a trusted family member or friend to appoint to be your POA, find out who can help.]Scenario #2: You pass away
When you pass (no one wants to discuss this, of course, but it’s inevitable for all of us), it is important for your executor to know the various accounts you have and how to access them.
Otherwise, closing out accounts and settling your estate (paying taxes, sorting through any outstanding debts and getting your heirs the funds you intend for them to have) can all be delayed. It also creates a lot more work for your executor if they have to go on a scavenger hunt looking for your accounts and passwords. Additionally, if accounts go undiscovered, it’s possible that your heirs may never see part of your estate.
Note that a power of attorney’s job ends when you pass and an executor’s job begins at that time.
[Read about the most important legal documents everyone should have].
What Accounts Should My POA/Executor Know About?
All of them! When you are listing your accounts, you will want to include your financial institutions, of course, but also your social media accounts, credit card accounts, online data storage, etc.
Here are some of the most common types of accounts people have:
- Bank accounts (checking, savings, money markets)
- Brokerage accounts (individual, IRAs, 401Ks)
- Credit Cards
- Mortgage
- 529s
- FSA/HSA
- Insurance accounts (auto, home, life, car)
- Utilities (phone, gas, electric, internet, alarm company)
- Frequent flyer accounts
- Paypal/Venmo
- Social Media accounts (Twitter, Facebook, Pinterest, Instagram)
- Subscriptions (“__ of the month club”, Amazon Prime)
- Music/Video Streaming (Netflix, Audible, Youtube, Spotify, etc.)
- Document Storage (i.e. Dropbox, Google Docs)
- Photo storage (online storage, phone, hard or flash drive)
- Email accounts
- Device login-phone, computer, etc.
Additionally, don’t forget to provide your POA/executor (especially your executor) with your password for your computer and smartphone (think about the files and pictures, etc. stored on both devices).
That’s a lot of accounts and passwords. Probably more than you realized you have. Now the question is, what is the best way to inform your POA/executor about the details of these accounts.
[What are digital assets and what should you do with them?]
Best Ways to Inform Your POA/Executor About Your Accounts
You can let your POA/executor know about your accounts in any number of ways. It can be as simple as writing down the information in a notebook; just be sure to include account name, number and login details. Or you can jot down account details using one of the many free templates that can be found online, including Wize Plans’ free printable template.
In addition to informing your POA/executor about how to access your accounts, you may want to provide direction about what to do with certain accounts. For example, with social media accounts, like Facebook. Do you want your account to be closed when you pass? You may not care, but if you have an opinion about what you want to have happen to your accounts, it is important to let your executor know. If you use the Wize Plans template, these directions can be included in the area titled “notes.”
If you prefer a digital format for entering and storing your account details, there are websites designed for this purpose, including: Everplan and My Life & Wishes. These sites prompt you with questions about your various accounts. They also offer opportunities to upload important documents (i.e. your advance directives, will, etc.), so that all of your critical documents and information can be stored digitally, in one place.
Wherever you want to list your accounts (back of a napkin, notebook, printable template or on one of online sites) is not the important thing. What is important is that you note all of your accounts and passwords all in one place AND that if/when the time comes, your POA/executor knows where that place is and can easily access it. After all, nobody wants to have their care delayed or their heirs not inherit something because no one knew about their accounts.
