Manage Your Digital Assets

Mellody Hobson talks about wills during today’s “Money Mondays” segment.

I’ve talked about the importance of getting your affairs in order to assure your wishes are carried out accordingly, but I don’t want to talk about life insurance or bequeathing your stock portfolio to your favorite nephew today. Today, I want to talk about your digital assets—and the technological fingerprint you’ve left which will endure after your death.

Not exactly a picnic, but an interesting topic.

It’s SO interesting. Just recently, Google announced a new tool for managing what they are calling your “digital afterlife.” Google users can choose to delete their content or name beneficiaries, like in a will. And different products can have different directives. For instance, you can choose to have your email account deleted but to share photos on Picassa or YouTube content with certain people you designate.

How does Google know when you’ve died?

They don’t exactly. Google isn’t going to send flowers to your grave, but they’ll know when you’ve gone radio silent for an extended period. In Account Settings, Google users can choose whether to activate the ”Inactive Account Manager” feature after their accounts are inactive for three, six, nine or 12 months. And Google will send a text message and e-mail confirmation before taking any action.

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Before, survivors could only gain access to data stored with Google with a court order, and that was rare. Now, users can grant access to up to ten people.

Google introduced the feature just as states have begun to pass laws about what happens to digital remains. Federal privacy laws do not generally address the issue, but Congress is considering it.

Other companies are also thinking about the issue. Facebook has long struggled with how to confirm that users have died. It’s fairly jarring when the site offers up a deceased friend among “People You May Know” or suggests “Reconnect With…That Former Coworker Who Died!” With retirees age 65 and over, the fastest-growing group of new users on Facebook, it’s a problem that isn’t going to die, if you’ll pardon the pun.

But now Facebook’s “Information Download” program allows a user (or users) with your login and password information to access your old photos and posts. Additionally, Facebook can turn your wall into a memorial page, serving to inform individuals of your passing, provide a venue for sharing memories, and ensure your ghost never turns up in “People You May Know” and other suggestions.

Talk about the ghost in the machine! Do you have any tips?

There are a number of online services you could try. One is a free service on the website If I Die.org. If I Die allows you to pen personal messages that are delivered to your loved ones upon your death, giving you the chance to say goodbye and relay personal information they may need. The letters are sent while you’re still alive, but the service encrypts all messages for security until you’ve died. Your letters can include personal missives, instructions on how you want your services handled, as well as passwords for your social sites should your friends and family want to keep photos and posts from your accounts.

Setting up measures like this could make things a lot easier for survivors. There are plenty of cases in which people don’t know all the social media monikers used by a family member. Many parents have no idea their children use Twitter, Tumblr, Foursquare or Instagram — much less what their user names and passwords are. They’re not likely to spend time tracking down accounts and contacting social networking sites.

You mentioned legislation.

Yes. Five states have enacted laws that authorize the transfer of a deceased person’s digital assets to the executor or manager of the estate. Connecticut and Rhode Island’s laws apply only to email. Indiana’s law applies to any electronically stored documents, while Oklahoma and Idaho include social media.

But the better approach is for the social media companies to adopt policies that are similar to Google’s. People could determine exactly who will get what—just as they do in a will—before tragedy strikes.

Are your digital assets the most important thing for people to contend with when you die? Likely not. But they are assets nonetheless. Remember that it’s not always about dollars and cents, and it never hurts to have a plan.

Mellody is President of Ariel Investments, a Chicago-based money management firm that serves individual investors and retirement plans through its no-load mutual funds and separate accounts.  Additionally, she is a regular financial contributor and analyst for CBS News.