Almost 50 percent of Americans were victims of financial identity theft in 2020, and losses from identity theft increased 42 percent from 2019 to 2020, according to recent research. Online criminals are always on the lookout for information they can sell on the dark web or use to enrich themselves fraudulently. And many of us make it easier for them by not being careful enough online.
It’s possible to conduct financial business and shopping online while still protecting your finances; it just requires a little vigilance and precaution. Rather than leaving your information open to potential criminals, follow these steps to keep your financial information secure online.
Use two-factor authentication when possible
Two-factor authentication requires you to verify your identity twice before accessing a secure site, such as your online banking site. That may mean entering your password online and then entering a code that will be sent to your mobile phone.
If a site you trust asks for your mobile phone number or a second email address to provide multi-factor authentication, provide it. Thieves are much less likely to be able to access a site that requires both a password and a code sent to your phone.
Use different passwords on each site
Many people use the same password for every online account. While that makes it easy for you to remember, it also makes it easy for thieves to access your personal information.
For example, if you have an online account with Target and Target is the victim of a data breach, your account information may be exposed. If your Target password is the same as your bank password, your credit card password, and your IRS website password, the thieves will be able to use your Target credentials to access everything else.
Use secure passwords
In addition to using a different password for each account, make sure the passwords you choose are strong. A secure password should include letters, numbers and symbols, and at least 12 characters. Avoid including any part of your name, address or other identifying information in your passwords.
Some experts recommend attempting to use “passphrases” rather than passwords. That means combining two or more words, along with numbers and symbols. You can choose a combination of words that you can remember but would not be intuitive for someone else trying to figure it out.
Keep software and devices updated
Sometimes it feels like your smartphone or computer alerts you to a new update every few weeks. It’s easy to avoid downloading the latest updates just to avoid the hassle, but it’s not the safest strategy.
Those annoying updates are often developed in response to a security threat. In fact, the University of Maryland-Baltimore reports that more than 90 percent of software and operating system updates are designed to patch security vulnerabilities in programs. When a software program or operating system has a security hole in it, your personal and financial information could be vulnerable to cybercriminals. That means if you avoid or delay downloading the updates, your device will not be protected.
Avoid posting personal information online
Potential thieves can use all kinds of information to figure out your passwords, your location and your habits. It’s a good idea to avoid posting information that shows you’re traveling and away from home, or any identifying information about family members.
For instance, police departments have warned parents to avoid posting too much specific information with their children’s back to school photos. That’s because criminals may be able to use that information to access the family’s financial information.
In today’s world, it’s convenient to manage our financial lives online, buying, selling, banking, shopping, and splitting the bill with friends. Rather than worrying about the possibility of making your financial information vulnerable, take some smart precautions and then embrace the convenience of online financial management.