The death of a loved one is a stressful time. As relatives cope with grief, they may also be under financial pressure. The death of a spouse who managed family finances might leave the surviving spouse without access to necessary funds. While the survivor can easily withdraw funds from joint bank accounts, she will need to complete paperwork, and perhaps probate proceedings, before she can withdraw funds from accounts — including investment and retirement accounts — that were held solely in her spouse’s name.
As SeniorCareAdvice has noted, digital assets can be difficult to manage after their owner dies. This is true even in states that designate such assets as community property. While beneficiaries named in a will — and relatives who have the right to inherit from those who die without a will — should eventually obtain funds they are entitled to inherit, the process of locating and transferring those funds can take time. It may be much more difficult to gain control over non-monetary digital assets, including Twitter feeds, contacts stored in a Smartphone, and photographs posted to social media accounts.
Share Passwords with a Trusted Family Member
Almost everyone who owns property should have a will. A will is essential for someone who wants to decide how his property will be distributed, rather than allowing those choices to be governed by state law.
While a will may hasten the distribution of the deceased person’s property, it does not cause property to be transferred instantaneously. A spouse or child who depended on the deceased relative for support might wait months before funds from the deceased person’s solely-held accounts become available.
Making a spouse or adult child a joint owner of the account is one strategy to avoid delay. The joint owner of an account will rarely have difficulty withdrawing funds from the account after the other owner’s death.
Financial institutions — particularly those that manage investments — typically allow account owners to designate a “payable on death” beneficiary. Even when the account is not held jointly, that designation will usually allow funds to be transferred to the designated person as soon as the institution receives the account owner’s death certificate.
Another method is to give a trusted family member a list of account passwords, as well as login credentials for computers and smartphones. Note that it might not be legal for a family member to use passwords to transfer or withdraw funds after the account holder’s death, as the funds belong to the deceased’s estate, not the relative. It is essential to obtain legal advice before using the deceased relative’s password to transfer funds.
Note also that the Computer Fraud and Abuse Act prohibits accessing a password-protected computer without authorization. The deceased person may have authorized access by sharing his password, but the intent of a person who is no longer living cannot easily be discerned.
Using a password to access information of sentimental value shouldn’t trigger a prosecution under current guidelines, but those guidelines are subject to revision or changing interpretations. In addition, the Department of Justice has been known to disregard its own guidelines.
Copying or downloading content may violate the site’s terms of service even if the content has no financial value. For that reason among others, a New York Times article cautions relatives to “step lightly” when they use the passwords of a deceased relative.
Fortunately, using a password to access and copy family photographs and similar content — even if the site’s terms of service provide that the content belongs to the website owner rather than the person who posted it — probably won’t trouble law enforcement authorities. It is much riskier to use passwords to access things that have financial (as opposed to sentimental) value, even if the person gaining access would eventually have inherited that property.
Even if the download is harmless, it might need to be accomplished quickly. If the website owner learns of the account holder’s death, it may disable the password and freeze access to the site.
Google and Microsoft, among other companies, refuse to give access to deceased-user accounts, although they may honor requests from a spouse or appropriate family member to close the account or to download certain information. Using passwords before they are disabled may be preferable to fighting with the site owner to regain access to the deceased relative’s content. Still, it is advisable to obtain a lawyer’s assistance rather than proceeding at your own risk.
Other Steps to Take
Probate lawyers typically advise the person who will be managing the deceased’s estate to obtain several certified copies of the death certificate. Financial institutions will need them to remove the deceased’s name from joint accounts, to close solely-held accounts, or to pay funds to a designated beneficiary.
Using the password to the deceased’s computer or cellphone, a trusted relative can search email, banking records, and sites like PayPal to identify bills that the deceased routinely paid. Automatic payments for cellphone plans, utilities, cable TV, internet service providers, Spotify, subscriptions, and other accounts should be discontinued immediately. While some providers may demand a death certificate before closing a service (causing delay that allows them to bill for another month or two), canceling automatic payments may encourage them to close the account more quickly.
The relative can also notify the estate lawyer about unpaid balances on credit cards or installment loans. The lawyer may advise the family not to pay those debts unless the creditor files a claim against the estate. The lawyer will also need to know about funds that the deceased held in investment and bank accounts, and balances that may exist in Venmo or PayPal accounts, to assure that those funds are recovered and distributed to beneficiaries.