Updated on 07.07.11

Online Banking and Contingency Plans

Trent Hamm

A few weeks ago, I put out a call on Twitter and on Facebook for detailed posts that people would like to see. I got enough great responses that I’m going to fill the entire month of July – one post per day – addressing these ideas.

On Facebook, Patsy asked about “Online Banking… Paperless statements etc… Good idea? Cons: hackers, spouse doesn’t use computer much, so what happens when the other spouse dies?”

Patsy is really asking two separate questions here: how to protect your identity when using online banking and how to plan for account access if the partner using the account heavily dies.

Online Banking and Personal Security
People don’t like to hear it, but it’s true. You alone are the key to avoiding identity theft. In an online world where sophisticated criminals can get a lot of value out of your personal data, you have to protect it. You are aided by the fact that banks do as much as they can to keep you secure, but they’re not infallible. You have to do your part, too. Here are some essential steps.

Use strong passwords – and don’t repeat them. If a site allows you to use a password, use one that is long, does not include common words or names, and does include a variety of letters and numbers. Your best bet is to use a random password generator like this one. Use a strong password like this for all of your vital accounts – and use a different one for each vital account. Take action and change your passwords on your vital accounts right now.

Use antivirus and anti-spyware software on your computer. Good software like this is a great investment. I’m a big fan of AVG, but do your own research and find a great antivirus and anti-spyware package that meets your needs. Take action and get a strong antivirus and anti-spyware package on your computer.

Don’t store your passwords in an easily-accessible place. If you keep your passwords written on a sticky note on your monitor or under your keyboard, your identity is only as secure as the location where your computer is. Don’t leave such information in such an easy-to-access place. Take action and use software like a KeePass to keep all of your passwords secure.

If your bank mails out sensitive information by email, stop getting electronic updates. Most banks have enough sense to keep truly sensitive information (like account numbers and so on) private, but some banks will email out statements with such information on it. If you get such documents in your email, your identity is only as secure as your email (which isn’t really very secure). Take action and if your bank sends out such information, request that they stop sending it to you.

These four steps will go a long way toward making your online banking more secure.

Online Banking and Future Planning
At the same time, what do you do if you use an online bank and your spouse knows nothing about it? Most online banks do have procedures that helps survivors out in the event of an account holder’s passing, but you need to do your part in avoiding this process or at least making sure it goes off without trouble.

Keep basic information, such as a list of your accounts, in a safe and secure place. Simply make a list of your financial accounts, with account numbers, account holder information, and PINs, and keep that list in a very secure place. A safe deposit box at a bank is a good place to keep it, for example. This document will help those you leave behind to go through your accounts and take care of them as needed. Take action and create such a document today, then immediately store it in a secure place.

Update such basic information lists regularly. Account lists and other such information can grow stale over time, so you’ll need to update the list regularly. If you choose to keep an electronic copy of this type of document so you can update it regularly, keep that document on an external storage device that you can also save in a secure place. Never keep it on your main hard drive. Take action and find a secure place for electronic versions of your lists, and update it regularly.

Make sure the executor of your will at least knows where such information is. You may want to include a mention of it along with your will, just so that in the event of your passing (or in the event of both you and your partner passing), the information can easily be found by parties who will need it. Take action and amend your will appropriately.

These steps will make sure that your account can be managed upon your passing.

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  1. valleycat1 says:

    Account Information – I’d add a customer service number, email address or snail mail address if the surviving spouse isn’t a computer user. They’ll probably also need info on your “secret questions” & answers.

    If a safe deposit box at the bank is shared or in the deceased’s name, the survivor isn’t going to be able to access it until the estate is probated or settled. One solution, if that’s the way to go, is to have separate boxes & store your spouse’s info in yours & vice versa.

  2. Michelle says:

    I read an article once that suggested you think of a phrase that reminds you of your bank (or wherever you need the password), break it down to the first letters, so if my phrase was, “Wells Fargo Is My Bank”, it would end up being, wfimb, then add a number 4-6 character that you can remember, maybe 1995, and add that to the string of letters, making it wfimb1995. Then as a final protection, hit “shift” when you type in the first 2 characters and the last 2 characters, making your password, WFisb19(%. To you it makes sense, and is fairly easy to remember (especially when you are typing it in every few days or so), but it’s really difficult to break. I tend to forget passwords that come from a random generator, and I don’t like to keep things written down anyway accessible. So this works for me! Obviously, you want to use a different password for each institution, but the method is the same!

  3. Ann says:

    I purchased an identity theft rider for my homeowner’s policy. Identity theft can still occur in spite of safety precausions. If it does, my insurance company deals with the entire, time-consuming mess. If my house should be lost in a fire, I don’t plan to re-build it myself. I look at identity theft protection the same way. And it’s cheap, about $25 bucks a year.

  4. littlepitcher says:

    You can do it all, and some creep will still find a loophole. An old acquaintance just discovered that some malicious soul had put up a scurrilous, if not slanderous, LinkedIn page in my name, with my real e-mail address (seriously, does a contract cleaner really need a LinkedIn page?) and had it blocked for me. Now I have to worry about similar adult-on-adult cyberbullying and identity theft on other social web sites where I have elected not to participate, and about repercussions if and when I have to seek more contract work.

  5. deRuiter says:

    Have your credit reports blocked by the three agencies, Experion, Trans Union and I forget the name of the third. Depending upon your age and your state, this is free or costs about $15. If you’re the victim of identity theft it is free. Your identity can’t be stolen, and you can’t casually apply for a credit card or loan you don’t need as you need to submit your pin number to have credit reports unfrozen. Great, free or dirt cheap protection. Plus the credit reporting agencies hate it because they earn money dispensing your personal information to anyone who pays them for it.

  6. Luke G. says:

    I’m a fan of LastPass as a password manager. KeePass was mentioned, but I like the fact that I get the stored passwords on basically any device I have at home and work and wherever else without any hoop-jumping that KeePass required when I last looked at it.

    Just my $0.02!

  7. Toby says:

    Passwords made of random letters and numbers might be secure, but are impossible to remember. It’s been shown that just stringing two words together is both secure AND memorable.

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