In today’s marriage ceremonies, it’s part of the vows to agree to have and to hold from this day forward, for better or for worse, for richer, for poorer, in sickness and in health, to love and to cherish, and to exchange online passwords and financial and consumer account information, right?
Maybe not, but there are plenty of horror stories of what happens when a spouse dies unexpectedly and the surviving member of the marriage has the unforeseen problem of tracking down financial information.
With most companies encouraging customers to go paperless, many of our accounts, bill paying and other financial-related and personal information are online. But not many couples treat the sharing of passwords and ensuring both parties can access accounts securely on the same level of planning for retirement and executing wills and trusts.
Tracy Shackelford, a financial representative with Northwestern Mutual, has first-hand experience with the situation. In 2010, a client of hers lost her husband.
“She had no idea how much money they had, where it was, where the accounts were,” Shackelford said. “It was horrible, it really was. She had no idea where certain bank accounts were, she couldn’t get into anything, nothing. She was able to track things down, but it took time and it took energy at an emotional time when she wasn’t up for it.”
As a result of that experience, Shackelford began actively using a brochure Northwestern Mutual created – called Digital Property Checklist – that she hands out to clients advising them to write down accounts and passwords.
While a 2014 study by the Pew Research Center found that 67 percent of computer users in a marriage or committed relationship have shared the password to one or more of their online accounts with their spouse or partner, couples may not be sharing all of the information and keeping it up to date. Bank accounts, retirement accounts, IRAs, credit cards and other consumer accounts, medical-related accounts and other financial and related information should all be shared.
If one person in the relationship has access to an account and the other doesn’t, it’s not like they can even root through papers on someone’s desk to find out about it because often, the sharing of passwords by couples for essential financial and other information isn’t even considered.
At Sera-Brynn, we advise couples to have a conversation about passwords and account information. Here’s some advice for couples about passwords and financial-related accounts:
—Have a plan for accounts that are maintained online. How will it be accessed in an emergency? Who is aware of it?
—Have your spouse as a secondary account holder or as an authorized person with access to accounts.
—Keep a joint list of accounts and access information on paper; and store this information in a safe or fireproof box.
–If you store electronic statements or account information on your hard drive, use encryption and make sure to keep an offline backup.
—If you get statements electronically, print one out at least annually and store it securely.
—Have an annual review with your spouse to make sure account information and passwords are current.
—Notify anyone listed as a beneficiary that accounts exist and where you store your access information.
—Keep your home computers patched and protected, and never access sensitive account information on a public wi-fi network.
We are often asked about online password management applications or websites and those can be an effective way to manage multiple complex passwords – just remember nothing is 100% secure.
Be wary of managers that automatically fill in the password in your browser. An application that stores the password and allows you to cut and paste is more secure. In either case, make sure the master password is highly complex.
Many offer two-factor authentication methods; take advantage of this feature.
With so much of our lives online, planning for unexpected events and accounting for the digital aspect is an essential part of managing your financials. Spending an hour or two getting organized with your partner now will benefit everyone in the future.