Don't take your passwords to the grave

By Liz Pulliam Weston

There's no question that online banking, electronic bill payment and personal-finance software make our lives easier.

But could we be creating a digital mess for our heirs when we die?

One poster on the Your Money message board shared her family's trauma when her father died without divulging the passwords to his computer or online accounts.

"I am the co-executor of the trust and the most financially savvy of my siblings, so it was up to me to help mom. But what do you do without passwords?" poster Tuppermom asked. "And most companies don't just give you access -- it is a process that can take weeks and months (if they don't just say 'Oh -- he's deceased? OK, we'll close the account' and then NO ONE has access!!)."

Tuppermom's family got lucky when it stumbled upon a folder that contained passwords for some of her father's work-related accounts and one of his online banks. That provided enough clues to find and gain entry to most of his other accounts. The family's lawyers helped them get access to the rest, although the process took time.

The experience was so traumatic that Tuppermom and her family revised their own estate plans to include complete lists of online IDs and passwords for each of their accounts. Concern about identity theft and security, she wrote, shouldn't go so far that family members are left in the dark.

The family "learned that ID protection is not JUST about nobody knowing the passwords," Tuppermom wrote. "It is also about protecting the asset behind the password -- and making sure that if you can't access it, someone you trust can."

Who would take over for you?

Your family could lose access to other potentially important digital files, too, if it doesn't have your passwords, including:

• Photo and music collections.
• Calendars and address books.
• E-mail accounts.
• Security and wireless-networking software.

But getting access to your financial accounts will likely be the most critical issue if you die or become incapacitated.

If you're not sure how important an issue this might be, try to imagine who would take over the functions of your financial life if you were lying in a coma. Then ask yourself:

• Could this person find and access bank and brokerage accounts?
• Would he or she know what bills should be paid and when?
• Are any of your accounts paperless and thus likely to be overlooked?

I'm a big fan of receiving most bills and statements solely by e-mail, as I wrote in "Go paperless for safer banking." But without a paper bill or statement, the person handling your affairs might never discover the account.

Any delays in accessing your accounts and paying your bills could cause serious financial repercussions. Unpaid bills could devastate your credit scores and wind up in collections. Insurance coverage could lapse. Bounced checks could result in your bank accounts being closed. Neglected investment accounts could suffer losses. The list goes on.

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