13 Tips to Keep Your Financial Information Secure

Let’s face it, keeping your financial information secure these days can feel like playing whack-a-mole with scams and identity thieves. Every time you feel safe with fresh passwords or new protective measures, thieves invent sneaky new ways to hack your systems. And that puts your money at risk!

Between online banking sites, apps on our phones, fraudulent phone calls, or even the midnight bandits ransacking our trash cans to steal old bank statements, it’s hard to keep up with all the vulnerabilities we have these days! But hey, don’t worry… This post explains a bunch of ways to keep your money safe from sneaky scams and shady characters.

1. Use Stronger Passwords

First things first: if you’re still using Welcome1! as a password, chances are your identity is already living a life of luxury in the Bahamas thanks to some not-so-friendly hacker. Change that password ASAP! 

Setting up a strong, unique, alphanumeric password (including random special characters) is an absolute must for any website that contains your financial information. Passwords are the first line of defense to protect and secure your financial information, so take them seriously.

Given the crazy amount of logins we have these days to various sites and apps, it might make sense to use a password manager, like LastPass, Bitwarden, or 1Password. These apps not only help you generate random passwords for all of your logins, they store a list of them all for easy access and they make logging in much faster.

Ps. Be sure to lock your phone 📲 with a unique password also. 1111 is something five-year-old can guess (I learned the hard way with my son 🤦‍♂️)

2. Enable Dual Factor Authentication

In addition to using unguessable passwords, most financial applications offer some type of dual factor authentication which you should opt-in for. This added layer of security means that after the first step of logging in with successful credentials, a second verification step is needed.

Often this is either a text message sent to your phone with a secret code, or perhaps a time sensitive code sent to your email. Fingerprint or Face ID could also be an option using a smartphone for most modern banking apps.

You might be thinking, “but this all makes it harder and takes longer for me to log into my apps.” Well…that’s precisely the point! This tiny inconvenience for you → means a mammoth inconvenience for hackers. It’s one of the most secure ways to protect your financial information online.

3. Set Up Spending Alerts (& Track Spending)

Most financial institutions and credit card companies allow you to modify notification settings for security purposes. Enabling these settings takes less than 3 minutes, and could save you huge headaches if someone tries to make purchases using your accounts.

For example, your bank might have the capability to send you a text message every time your balance drops below a certain dollar amount. Credit card companies can alert you when transactions over a certain threshold are made. Some apps even notify you when new login attempts are made from locations around the world.

Anytime you get an alert, you can jump to fix things immediately. Change your password, call your bank, cancel your credit card, dispute transactions, etc. The faster you can address potential threats, the more you can reduce the potential damage.

Pro tip: Try tracking all your spending with a free app like Empower. Fraud aside, looking at all your transactions regularly lets you catch double-billing errors, as well as any accidental overspending! 

4. Use Trusted and Private Wi-Fi Networks

Do you really need to log in and check your bank balance when you’re connected to the Jack-in-the-Box free Wi-Fi? The person sitting six tables over with his laptop might be running malicious software that monitors all the network traffic, and can easily spy on your banking session.

For the best security, stick to trusted Wi-Fi networks when logging into financial apps, like your home Wi-Fi or at a close friend’s house. You’ll minimize the risk of unknowingly leaking financial information, and be able to bank in peace without worrying about digital lookie-loos.

Also, whenever you’re done with online banking sessions, make sure to log out of your app when finished. Closing your session fully will make sure nobody can ‘piggyback’ on your access and mess with your accounts.

5. Call to Confirm Wire Transfers

One of the fastest growing money scams right now happens when people are buying a home or rental property. Right before the day of closing, homebuyers receive an email from their escrow company telling them there’s been a change in wiring instructions. Since the email seems legit, victims wire their down payment cash to the new bank numbers, falling for the scam.

Sadly, this happened last week to a Californian couple, who ended up losing $160,000!

To protect against wire fraud:

• Always double & triple check routing and account numbers.
• Call the recipient and confirm everything over the phone.
• Don’t trust emails and texts, especially last minute “changes” in instructions.

Wire transfers are irreversible. And big bucks are on the line! So be extra vigilant when sending money this way. Be mindful that real estate escrow and title companies are big targets for hackers. Be sure to double-check all wiring instructions verbally before completing any wire transfer.

6. Freeze Your Credit

Freezing your credit is like putting a force field around your financial identity. When your credit is frozen, nobody (not even you) can apply for new lines of credit under your name.

Luckily, freezing and thawing your credit is really easy these days. And it’s free! There are 3 major credit bureaus, and you’ll need to perform freezes separately for each one. Here’s how:

• Experian: freeze your credit for free
• Equifax; freeze your credit for free
• TransUnion: freeze your credit for free

Most of us don’t apply for new credit cards or loans very often, so there’s no harm in freezing your credit continuously, then unfreezing when you need to submit an application. It’s easy! By the way, don’t fall for the ‘credit lock’ offerings from the bureaus. Those cost money and aren’t nearly as effective. Credit freezes are free thanks to federal law – they’re the best way to go.

Ps. You can even freeze your kids’ credit, and here’s a full post on how to do it.

7. Shred Financial Mail & Statements

Wherever possible, sign up for paperless billing so that no physical statements are sent to your house. This not only limits exposure of your information, but also cuts down on clutter building up in your house!

Even if you have 100% paperless statements, you still probably receive a ton of mail that contains financial information in it. New bank account or credit card offers, insurance documents, tax forms, etc. and all sorts of junk mail have your name, address and other information that might be valuable to fraudsters.

Instead of just throwing mail out, shred it first. Either pick up a cheap shredder on amazon, or you can manually rip up all the papers with your info on it before recycling everything.

8. Use Credit Cards, not Debit Cards

Credit cards have a slew of secondary benefits that most people don’t even realize. Among them is built in fraud protection!

This means that if someone steals your credit card info and goes on a shopping spree, you can report the charges and get them removed from your statement.

But debit cards don’t work this way! If someone steals your pin and goes on a shopping spree with your debit card, you aren’t protected in the same way. It all depends on how quickly you notice the errant charges and notify your bank. 

This is especially important at the gas pump where thieves can easily install skimming devices to steal your card information. By using your credit card to pay for everything, you’ve got one less thing to worry about! Not to mention, credit cards have awesome cash-back and point earning opportunities. Debit cards aren’t the devil, but you’ve got less to worry about if you opt for credit cards instead.

9. Be Suspicious about Incoming Calls, Texts & Emails

Check out the text message I got this morning while literally writing this very post! 👇👇👇

Do you think this is legit? I don’t have any pending deliveries from USPS right now, and even if I did, why would they be texting me from an iMessage account?  *DELETE!

An ungodly amount of financial scams begin with innocent people receiving simple text messages, emails, or phone calls. While these might sound very legitimate to begin with, it’s really important to scrutinize and be suspicious of anybody who contacts you out of nowhere.

Even if they don’t ask for personal information upfront, most scammers build trust in phases, slowly gaining your trust so that you release financial information to them or send them money. Here’s a recent article from a financial columnist who just fell for a scam that put her out $50,000! It’s a fascinating read.

Bottom line: be suspicious of anyone who contacts you, even your own banks! If you’re not 100% sure who you’re talking to, hang up and call the number listed on their website. And this is doubly true for anyone claiming to be from “the government”.

10. Store Cash in a HYSA

You wouldn’t walk around all day with $10,000 in your backpack, would you? Or stick a large sum of money under your mattress? Of course not. Because you don’t need immediate access to that much cash, and a small mistake or unfortunate robbery might swiftly lead to losing all your money. Not to mention the eroding impact of inflation. 

Well, checking accounts are kind of like digital backpacks. They were built for quick and regular access to your money, but they have more vulnerabilities and they don’t come with the same perks that savings accounts offer.

Instead, for any money you are saving longer term, keep that cash secured in Savings accounts. In particular, we recommend high yield savings accounts (HYSA) so your money can earn the most interest while it’s in there, too.

Savings accounts have fewer access points to withdraw money (no check writing capabilities, no attached debit cards, monthly transaction limits, etc) so they are a better fit security wise. Emergency funds, house down payments, and larger short term savings should all be kept in an FDIC insured savings account.

11. Software Updates on Phones and Computers

In general, the longer a software version has been available, the more security variabilities it has. So one way to keep your financial information secure is to make sure you’re rolling with the latest operating software updates on all your devices.

Security is a tech manufacturer’s top priority, so most software updates include patches for any new security threats they find. Be sure to update your software and install new versions as they become available.

Another option is to pay for and install antivirus software on your computer. This can help alert you to holes in your system security, as well as attempts at hackers trying to steal information from your devices.

12. Be Extra Careful on Social Media

Last year, someone created a fake Facebook profile using my Mom’s name. Then, that fake account started private messaging all of my Mom’s contacts, gaining their trust and asking them for money!

It was scary to see how much personal information they had on my Mom, and how crafty the hackers were at using it to talk with contacts. As it turns out, my Mum (unknowingly) volunteered this information when she overshared a whole bunch of things on Facebook over the past few years! Since the event, she has made her profile private, and now only shares limited information publicly online.

These days, it’s absolutely essential to be overly cautious when sharing personal information on social media platforms. While it may seem harmless to post photos of our grandchildren or share our travel plans, this information can be used by scammers and identity thieves to target us. Social media can be a fun way to stay in touch with loved ones and friends, but be careful what information you share and be cautious when you’re asked for personal details via a direct message.

13. Help Your Less Tech Savvy Friends!

It might be a good idea to reach out and share security tips with your less-technical friends and elder family members. They may be more vulnerable to digital scammers because they don’t really know any better – like in my Mom’s case above!

First, encourage them to use strong and unique passwords for each of their online accounts. That’s usually something naive folks overlook. Enabling two-factor authentication (2FA) for them is also a great step!

The next highest priority is to help them be wary of phishing emails and text messages. Scammers specifically target those who aren’t so tech-savvy, and might easily fall for tricks. It’s crucial to teach your elderly friends to be skeptical of unexpected messages and to avoid clicking on suspicious links or attachments.

Lastly, helping them keep software and operating systems up to date is important. Although you might become their de facto “it guy”, it’s a small price to pay for protecting their financial information and keeping your close friend’s identity secure.

The Bottom Line:

These days, our financial information is constantly on the move, making it vulnerable to scams and harder to secure. No need to be paranoid, but do make sure you’re prepared. Whether you’re shopping online, using mobile banking, or sorting through emails, it can feel overwhelming to keep your hard-earned cash safe.

But by using modern security tools available to you, being mindful about when and where you access your accounts, and remaining suspicious of any incoming messages, you can build a secure financial fortress, protecting your money from digital pickpockets and giving you peace of mind!

And don’t forget to check in on your elders and not-so tech savvy friends!

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• Don’t trust financial advice from these folks