Circumstances can change in an instant and electronic security, now more than ever, is an important step to take in thorough planning. If the head of a family’s health fails, their spouse has an accident or they simply find themselves out of the country in need of medical attention, how can families make wise decisions and access sensitive, often confidential information quickly?
Electronic document storage not only adds a layer of protection on the personal security front, it assures that if something happens requiring quick decision making, there is a game plan in place.
Today encryption technology used by both global corporations and governments to secure highly sensitive information is widely available.
In addition to carefully monitoring investment and bank statements, trusts and agreements, medical records, healthcare proxies, deeds, registrations, contracts, copies of passports and other vital documents related to the family, intelligent high-net-worth families retain an electronic repository.
Hard copies of meaningful papers typically exist in a desk drawer, or piled somewhere in the home designated for “important papers.” At best, their electronic equivalents may linger on a personal computer – to which only one person has the password. There is a difference between excellent security and excellent planning in case of an emergency, accident or sudden tragedy.
No one wants to plan for life’s worst-case scenarios. But those who do are in a position to make on-the-spot decisions—which might be life or death. 1) What happens if a home burns down? 2) Is there a plan in place for sudden, unforeseen change within the family? 3) While an attorney may have copies of some things, a lifetime of records can be wiped out in moments. If not, no matter how meticulous or jumbled the filing system of hard copy documents, redundant storage locations may create additional vulnerability and risk to confidential information—particularly if multiple individuals have access to these files.
One family matriarch, let’s call her Claire, has three children. Unfortunately her physical and mental wellbeing deteriorated rather suddenly due to an illness that lasted for a few months. While she had lucid moments, Claire knew her cognitive function was in decline. So she consolidated all of her vital papers including financial records and records, x-rays, scans, even details about her prescription medications, to the family’s electronic vault. While Claire’s original prognosis seemed bleak, her health eventually turned around for the better. However, before she became ill, she wrote letters for each of her physicians to freely answer any questions her three children have about her health. These notes, all stored within her electronic vault for easy access, allowed physicians to uphold HIPPAA standards and adhere to the law while allowing Claire’s kids to receive critical information promptly.
“The often bureaucratic workings of the 21st century healthcare system, coupled with the intricacies of modern medicine, likely mean a patient has a team: a primary care doctor and several specialists. Patients advocating on their own behalf are most prepared when important medical histories, tests, and other data, are at their fingertips, particularly if a medical issue needs to be addressed by multiple specialists. Retrieving such vital information, particularly in an emergency, may be fulfilled most efficiently when patients have their own medical information in one repository, at their immediate disposal,” says Dennis Ryll, an ophthalmologist outside of St. Louis, Missouri.
The electronic vault granted Claire’s three kids limited access to her electronic vault. All three were able to see all of her medical data and records. However, only her daughter, a CPA who she named as a trustee of her estate, could access her financial data. Claire wanted her daughter to be able to quickly step in and make decisions in the event of any emergency—so Claire granted her daughter full access to the entire electronic vault: personal health records, financial data, legal papers, passwords, copies of her passports and other private information.
“We never encourage clients to simply hand over the keys to the kingdom with a password,” says attorney Gerry Dunworth of Gibney Anthony & Flaherty, LLP, “consolidating documents in an area the family can access today is a far cry from the safety deposit boxes and manila file folders of the past—but ease and convenience are not to be taken lightly—particularly when a young person is still learning the responsibilities expected of them within the family.”
In addition to trusts and other documents specifying the eventual division of assets, Claire’s daughter saw every important record she possessed. The electronic vault offered a “velvet rope” for keeping private papers private—her other children only saw her medical data.
Our ever-increasing use of technology to communicate and access information can be a marvel. However, it is essential as investors embrace the 21st century technology landscape, privacy measures regarding personal, financial, healthcare, and familial data remain fiercely protected.
No matter what families opt to store in an electronic vault, the opportunity to mitigate any security risks to sensitive information is worth examining.
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