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You are likely among a large amount of Americans that manage their financial accounts online. You love it because it saves paper, cost of stamps, and eliminates the risk of people peeking into your paper mail. The financial institutions love it because they save money (which they don’t pass on to you) and they don’t need as many in person customer service reps.
There are some risks to having all of your business online. Some people may point to the risk of someone hacking into your financial accounts, which is a risk – but it requires people know something about you or that they break through very strong financial site encryption – possible but not likely.You can combat that by using obscure pass-codes, not keeping credit card information “on file” with sites like Amazon, and keeping number of accounts limited so you can track unusual activity and spot it quicker. Also, for the super cautious, putting bank savings in a good ole passbook savings account and smaller amount in checking could help too.
How Safe Is Your Data?
However, another risk, which you may not be prepared for is loss of data. This could be caused by a massive failure at the site where your financial institution stores its data or it could be caused by a targeted or random virus. Either way, it makes sense to do the following:
- Keep a paper copy of your annual statement or a scanned copy on a local storage device
- keep copies of your credit cards (front and back)
- Keep copies of your passport, driver’s license and social security card
- Keep copies of your children’s documents
- Keep copies of other important documents (legal, tax, debts, etc)
Possible storage locations include (but not limited to):
- a local hard drive for electronic copies
- safe deposit box at a bank
- safe at home
- safe at your office (where maybe you have more alarms and security than at home?)
It may also make sense to keep second copies with other people – for example, if your brother is your power of attorney then it may make sense for him to have a copy of that document or at least be aware of the copy at your lawyer’s office. If you’d like to discuss security of your financial information, including working with a boutique financial planning firm that won’t share your data with affiliates because we don’t have affiliates, give us a call -781.393.0021. or feel free to use our contact form HERE.
Note: these lists are not exhaustive but should provide a starting point in your planning on data security and recovery.