Protecting your money in a digital world

Steps to keep your finances safe

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Michael Carlin, AIF®

Cybercrime and personal cybersecurity get a lot of media attention, but we find this is an area many people aren’t paying enough attention to. Criminals are going after technological vulnerabilities within financial services firms and clients’ financial accounts because that’s where all the money is. The need for you to be safer with your digital finances and more secure with your money becomes more paramount with each passing month as new digital attack strategies are being developed and launched daily. This article hopefully will provide you with tips to help keep your money safe and secure in this new digital age.

The rise of cybercrime

Did you know there are more than eight billion connected devices, which means there are more network pieces of technology than there are people in the world. We’re more connected than ever and have access to more information than ever. Financial institutions are giving their clients the freedom and flexibility to operate on the cloud from multiple devices while offering more choices and channels to access accounts and finances. This digital financial freedom comes at a cost – many more avenues and pockets of availability for cyber criminals to hack into your accounts.

In 2017, breaches and fraud incidents, both online and offline, increased more than 130% year over year, costing clients countless dollars and hitting the reputations of many financial services companies. In response to these cybersecurity threats, 40 states have adopted privacy legislation and rules requiring financial institutions to create better protocols to help secure their clients’ financial data. Many experts believe there are only two types of financial services firms with regards to digital security – those that have already faced a cyberattack and those that haven’t – yet.

Keep your information safe

Let’s look at a few vulnerabilities that are out there and steps you can take to improve your overall digital financial security.

Think before you click. Did you know that social networks are one of the most favored methods criminals are using to extract your personal financial data? One of the most popular schemes is to lure users into downloading and running a malware program. According to sites like Wired.com, hackers are even using tools that were stolen from the National Security Agency (NSA). Experts are expecting fraudsters to start using that tool to find ways to infiltrate your account by getting you to click on something and unknowingly install a malicious program on your computer. Best practices here are to simply be extremely careful before clicking and opening any files from a social network. Be absolutely sure you know what you’re opening and use the clicking function on your mouse judiciously.

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Check your passwords. The first and easiest rule we can give you here is to have a very long and strong password on your financial accounts as well as your email. With this step, we also encourage you to have unique passwords for each account. A rule of thumb about the best passwords: make sure it’s composed of at least 12 random numbers and symbols and uses both upper and lower-case letters. We would recommend getting away from what we find clients normally do – like using people’s names, a number and exclamation point. Your password should be random characters with other symbols – not just a single exclamation point!

For those who feel this might be too complicated, there are a bunch of different password manager services and software programs to help generate a different password for each of your financial accounts. A rule of thumb when choosing a password manager: an institution that is going to charge a fee for that service might offer you a little bit more safety and security than one that does not.

A final note regarding passwords – multi-factor authentication. Most financial institutions are already offering this service and surprisingly, we are finding clients are not adopting this technique often enough. We recommend every time you’re offered multi-factor authentication, you opt in for that service to make your accounts as safe as possible. However, keep in mind that getting a secondary password by phone, email or text isn’t a guarantee either. We just want you to take all the available steps and measures to make your money as safe as possible.

Disposing of electronic files. When getting rid of your electronic devices – computers, hard drives, thumb drives, etc., it’s important that you do so in a responsible way. Even though you’re confident you have deleted all the files, restoring them is easier than you might think for an enlightened hacker. I bet you thought that if you deleted a file on your old computer or external hard drive the data was permanently erased…well, think again! Check with your local better business bureau about secure recycling of electronic devices. You’ll find that there are certain dates, times and places for you to drop off your devices and have them disposed of in the safest way possible.

As we mentioned, hitting the delete key doesn’t necessarily remove files from your electronic devices permanently. You will find there are several viable free software programs for PCs to securely delete your data. An additional step that we recommend for your external document storage devices is to encrypt the data you have in storage. There are built in tools on some storage devices or third-party apps that will allow you to do this.

Check your credit report. Every year, once a year! We recommend you go to www.annualcreditreport.com (unless you’re using a program like LifeLock or an equivalent) to help monitor and manage your credit. By checking your credit report at least annually, you can increase the chance that you’ll discover a financial hack or potential problem close to when it occurs. If you find errors or unauthorized activity, we encourage you to report this to the credit bureaus immediately. What you’re looking for when you go through your credit report are late payments, open financial accounts that you don’t recognize and a general overview to make sure everything looks good. This once a year look is a good way to be financially responsible and stay on top of your digital financial world.

Be proactive

Don’t put your head in the sand about your finances and their security. Being proactive can be one of your best defenses so start to take steps now to make sure your information is safe.

Michael Carlin, AIF®, is the President and Founder of Henry+Horne Wealth Management. He can be reached at (480) 483-3489 or MichaelC@hh-wm.com.

© 2018 Henry+Horne Wealth Management

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