Families are in danger of losing tens or even hundreds of thousands of pounds on the internet, and for once fraudsters are not to blame. Instead, it’s our own fault, for failing to tell our nearest and dearest where we keep our money and how they can access it when we die.
As more of us manage our money online, doing everything from everyday banking to trading in shares or Bitcoin, there is a growing danger that huge sums could get overlooked if we fall seriously ill or die suddenly.
More than two in five fail to share details of their digital wealth with loved ones and family members often have no idea that it exists in the first place. Huge sums are at stake, imperilling inheritances.
More than two in five say they have failed to brief somebody they trust on how to access their digital wealth. Of these, a third have never even considered doing so, according to research from financial advisers St. James’s Place.
Many people change their passwords so regularly for security reasons that they say keeping details up to date is too much work.
More than a third rely on memory to keep track of online passwords, and have no physical or digital record.
St. James’s Place director Eddie Grant said a growing list of financial products and services leave no paper trail and this makes sharing details with a trusted individual in case of death or incapacitation increasingly important.
Otherwise it could be lost for good.
Among those who have shared details, many did so after experiencing a personal loss or suffering from a serious illness themselves, which made them realise the importance of sharing.
Grant recommended drawing up your digital legacy as part of wider financial planning, and storing it in a safe place so it cannot fall into the wrong hands.
He said the first step is to do the basics by preparing or updating your will, to set out your wishes, direct your executors and reduce potential disputes.
While doing this, get your papers in order. “Track down and keep all your financial documentation in a designated place, and tell loved ones where they can find it.”
Draw up a list of your digital wealth, including bank and savings accounts, as well as any pensions, investments and insurance policies.
This can help next of kin track and close all online accounts. It also gives them peace of mind as they know for sure that nothing has gone missing.
Grant said it is important to discuss your legacy with your family, even if it feels awkward or embarrassing. “Have an open and honest conversation to express how you ultimately want your wealth to be shared.”
He also suggested drawing up a certified Lasting Power of Attorney giving someone you trust the authority to make financial and health decisions on your behalf if you lose the mental capacity to do so yourself.
Life rarely goes to plan so prepare for the unexpected and review your decisions accordingly. Financial advice may help, Grant added.
Online accounts will remain active after you die, unless somebody can ask the authority to close them.
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As well as bank accounts, we need to pass on details of digital wallets, PayPal, pensions, crypto-currencies, email accounts and social media accounts such as Facebook and Instagram.
Website DeathWithDignity.org also recommends worth sharing details of home services such your mortgage, water, garbage, power, internet, cable and household insurance.
Any subscriptions are also likely to roll on, unless loved ones step in. This may include streaming services such as Netflix, Spotify, Amazon Prime, newspapers, magazines and so on. Again, leaving details will help.
You could also die leaving unused supermarket loyalty points or Air Miles, or family pictures and videos they’ll want as a keepsake.
Many are understandably worried about the security implications of sharing passwords and logins, with one in six saying they wouldn’t do so under any circumstances.
If worried, you could always hold them with a solicitor, but again, remember to update the details regularly.
It isn’t easy keeping track of your digital whereabouts. Passwords need regular upgrading, for security reasons. People regularly move money around, to take advantage of best buy deals on savings rates.
But we all need to make an effort, or even more of our money will be lost in cyberspace.
