the age of digital estate planning

The digital age has brought about a lot of convenience- electronic payments, paper-less statements & quick and easy, 24-hour access to your accounts. However, it has also created a problem for people navigating the death of a loved one- access. A list of passwords is no longer enough. Two-factor authentication has changed digital estate planning. But, with the right pre-planning, you can avoid the pitfalls of the digital age.

why passwords alone are not enough

In the modern age, most online accounts require a two- step login process (two-factor authentication) which combines something you know (like a password or pin number) and something you have (like a phone, security key, or fingerprint). This is great for protecting accounts since many passwords are often compromised through phishing or data breaches. It allows your account to remain secure from hackers if they manage to steal your password.

There are several two-factor authentication methods (and these vary based on personal preference, program, etc). There are authenticator applications (like Microsoft Authenticator ®); SMS and email codes (requiring the user to enter a numerical code sent to an email or phone); push notifications (requiring the user to “approve” or “deny” on a trusted device); Hardware security keys (physical devices that you plug into your device or tap against your phone); and Biometrics (think Face ID, Fingerprints, or retina scans).

While these advanced and varied techniques offer security from hackers, they are also one of the most common reasons families cannot access accounts after death.

Doing things the “right way” (and the legally appropriate way) takes time and requires researching and going through each platform’s official deceased account process. This almost always requires you to present a death certificate, a copy of the will, and letters or forms establishing legal authority to act. This can take weeks or months- during which time the accounts remain inaccessible & loved ones are left scrambling to handle the estate without the resources to do so.

Furthermore, some platforms may still require authentication codes sent to the deceased person’s phone or email- and again, without access; the account remains locked behind a digital wall.

The accounts that families depend on for daily life are often the most problematic accounts to access

Financial accounts held exclusively online with no physical branch to visit require documentation that can be difficult to provide without proper legal authority… and obtaining the proper legal authority after a loved one dies is costly and time-consuming. Digital-only assets such as cryptocurrency, online business accounts, etc can also represent real financial value that disappears entirely if no one knows they exist or how to access them.

Even things like cloud storage containing documents, photos, or business records without a hard-copy or backup can become inaccessible.

A valid will can still leave your executor to face legal obstacles if it does not include provisions giving your executor authority over digital assets and specifying where the access information is stored.

When your family is grieving and needing to pay funeral expenses, the mortgage, medical bills, and cannot access the accounts that hold the money.

wills are not the best way to ensure your digital estate plan succeeds

A will is a public document, that gets filed with the Court and becomes public record. Anyone can pay a fee and access your documents. Listing passwords, usernames, account numbers, and credentials in your will is a bad idea.

A will should instruct on who has authority over digital assets and where to find the information which you have safely, securely, and privately held elsewhere.

A proper digital estate plan is a system that includes an inventory of every account that holds financial, sentimental, or legal value. It identifies the two-factor authentication method for each one- which phone number, email address, or app receives the verification code. It should identify backup authentication codes and to the extent there are backup codes that can be printed and stored offline. It should also name a person with explicit legal authority to act on those accounts under applicable law.

A proper digital estate plan gets updated. Phone numbers, email addresses, account information is all updated. If an email changes, every account it is linked to is updated in both the platform and the plan.

In many states (including California) the Revised Uniform Fiduciary Access to Digital Assets Act (“RUFADAA”) grants executors, trustees, conservators, and agents under a power of attorney the legal authority to access and manage a person’s digital assets upon their death or incapacity. In California, this was codified in Probate Code, Sections 870-884.

what does the law do for you?

California law establishes a strict three-tier hierarchy for who has the right to control digital accounts. Any digital service provider’s online tool (think Apple’s Legacy Contact) takes precedence over all other legal documents. If no online tool is set-up, the decedent’s will, trust, or power of attorney controls but only if these documents explicitly authorize digital asset access.If neither of those are present, then the provider’s terms of service will control.

Under this framework, a will or trust can include explicit digital estate provisions that name your executor and give them specific legal authority to access, manage, transfer, and close digital assets. These laws vary by state and each financial institution also has different requirements and processes. The plan should account for both the legal authority and the platform-specific process for every account that matters.

What you can do right away

Gather your information & create an inventory. Go through your accounts (email, financial, cloud storage, etc.) and for each one, write down which phone. number, email address or app receives the two-factor authentication code.

Check the recovery contacts on your email accounts. Many people have phone numbers or backup email addresses connected to those accounts that they set up years ago and have since stopped using.

Generate backup codes. Many platforms with two-factor authentication allows users to create a set of one-time backup codes. Print them, store them securely offline, and make sure the person who will manage your estate knows where to find them.

This may be a lot and feel overwhelming; but I can help. I can help understand your digital footprint and build a plan that actually works for the people who need to use it.

Schedule a complimentary 15-minute call and lets find out where you stand!