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Benjamin Franklin was a wise guy. He’s the one behind “Don’t throw stones at your neighbors, if your own windows are glass.” He also came up with “No pain, no gain.“ Amazingly, he shared this nugget about 250 years before the internet was even invented, “An ounce of prevention is worth a pound of cure.”
Online security is a growing problem that needs attention. This is especially true for seniors. I was recently reminded of this working with a client who experienced financial fraud. Thankfully, my client was made whole. But, it certainly didn’t come without worry and stress. In the spirit of prevention, here are some easy things you can do.
Two-Factor Authentication: This is the Holy Grail for your online financial accounts. Whenever you log in, a text message should be sent to you with a unique code to gain access to your accounts. Almost every reputable financial institution has this safety measure available. If you can log in, without going through a two-factor authentication process, please stop reading this article immediately and contact your bank, credit card and financial advisor.
Use a Password Manager: Every single person I know struggles to remember all of their usernames and passwords. Naturally, the easiest thing is to use the same login information for every website. Unfortunately, that happens to be the best way to let fraudsters gain access to every one of your accounts! So, what can you do? Use a password manager, such as LastPass or 1Password. These applications will allow you to establish unique passwords and, most importantly, securely store them all in one place.
Set Up Activity Alerts: If some crook does gain access to your accounts, there are things you can do to limit the damage. For example, many financial institutions allow you to establish text, email or phone alerts for large purchases or possible fraudulent transactions. If you cannot figure out how to set up these account alerts, once again just call your bank, credit cards or financial advisor for help.
Hobble Your Accounts: I have to admit, this suggestion might sound a bit weird. For my clients, I’ve purposely limited what they can do online in their investment accounts. Unless I’m told otherwise, they cannot just log in and proceed to buy or sell securities or move money out of their investment accounts. Of course, the same applies to every bad guy who might happen to gain access, too!
While going completely offline is always an option, it’s increasingly cumbersome. Remember, fraudsters don’t like to work that hard. They seek easy targets. When they hit a brick wall, they tend to move on. With a few easy steps, you can make it a lot harder on them while still enjoying the conveniences of our connected world.
Jason P. Tank, CFA, CFP® is both the owner of Front Street Wealth Management, a purely fee-only advisory firm and the founder of the Money Series, a non-profit program committed to providing open-access to financial education, for all.