Holding a phone about to unlock a password manager using the master password
Technology & Security, Fraud

Pros and Cons of Using a Password Manager

It's a good idea to explore an online password manager to help you keep your accounts secure. These services create and store long, complex passwords for each of your online accounts to help prevent cyber theft. If you're still using the same handful of easy-to-remember passwords on all your accounts, it's time to find an online password manager. But which one is right? And are they fail safe? Read on for the pros and cons of an online password manager.

What is an Online Password Manager?

An online password manager is essentially a program or subscription service that houses all your passwords in an encrypted virtual vault on your computer or in the cloud. Some of these services also offer to store other private information like security questions, credit card information, and more. Essentially, an online password manager “remembers” all your various account passwords for you so you can create lengthy, unique ways to access your online accounts without having to remember them all. The password manager has become a best practice for keeping yourself and your information safe online.

Pros of Using an Online Password Manager

There are many pros to using online password managers:

One Password for Everything

The best and most desirable feature is that instead of having to remember tens or even hundreds of passwords for your online accounts, you simply need to remember just one.

Automatically Generated Passwords

Having a hard time thinking of new and unique passwords? Some might even try to create a new password by randomly pressing keys on their keyboard, however that still creates a pattern in password creation because of the way that the keys are laid out. One of the many benefits of a passwords manager is that they not only store all of your passwords, but they can also create automatically generated passwords for you. Passwords that are automatically generated include uppercase, lowercase, numbers, and special characters to avoid any recognizable patterns. This service will help prevent you from repeating passwords that you've used in the past and will save you time from having to create secure passwords yourself.

More Security than Other Options

Password mangers provide extra security compared to other options. For example, writing passwords on a piece of paper or saving passwords into a document on your computer pose risks because they can easily be found by other people.

Works Across Your Devices

Another advantage, depending on which service you choose, is that it works across most or all of your devices: laptops, mobile phones, desktop computers, etc. This means as soon as you create a new login or change a current password, it will immediately be updated across all devices. The simplicity an online password manager creates for your life cannot be overstated.

Can be Shared with a Trusted Person

An online password manager can be a lifesaver in the event you're unable to access your accounts on your own. For example, if you're incapacitated by an injury or illness, or you pass away, having an online password manager in place can save your loved ones or the person in charge of your accounts from a lot of time and stress. Some online password managers even give you the ability to limit what your “trusted person” can see when they login. This can give you and those entrusted with handling your affairs peace of mind that they can access important information in a time of need.

Cons of Using an Online Password Manager

While the use of an online password manager is recommended as a best practice, there are some concerns to keep in mind.

Single Sign-On Poses Risks

With just one password to access your entire catalog of private login info, there is a risk that you or your password manager could be hacked - causing every one of your accounts to be compromised and potentially opening you up to major identity fraud. To help prevent this, make sure to implement multi-factor authentication on your password manager.

A Single Point of Failure

If you commit to cleaning up and securing all of your passwords into the password manager, it would be a real shame to then forget how to access that app. Hopefully, with just one complex password to remember, you won't have trouble, but if you were to forget, you'd be out of luck.

There's a Learning Curve

Speaking of switching over all your passwords, it will take time and you'll have to relearn the process for accessing your accounts. Thankfully, many online password managers simplify the process with browser plugins.

It Will Likely Cost You

While there are some free online password managers that offer simple features, the best, most comprehensive ones typically charge an annual fee or other subscription cost. While it may seem like an unnecessary expense, consider how much it would cost to repair the effects of someone stealing your identity if your passwords are compromised.

The Best Online Password Managers

Online password managers come in a few different varieties, but they essentially all do the same thing. Here are a few we like:

Bitwarden is a service that offers a free option, but even its paid service is affordable, starting at just $10 annually. This app is great if you just want a simple, straightforward password manager that syncs across all devices and has sharing ability with family or other trusted people. Bitwarden also offers multi-factor authentication for extra security with their free tier.

LastPass offers a free version of their password manager for either your mobile phone or desktop. If you want it to sync across all devices, it has an annual $36 subscription. The paid version allows you to share account access info with trusted people, and offers multi-factor authentication and 1GB of encrypted storage.

1Password is another subscription based online password manager that syncs across all your devices. It allows family sharing for up to five people as well as guest access for specific information you wish to share such as Wi-Fi passwords or home alarm codes. Multi-factor authentication is also available with their paid plans. After a free trial, you'll spend about $36 annually for the service.

It can be overwhelming to determine the best online password manager for your needs, but we recommend starting simple. If you're new to the entire concept of online password management, the best step is to get started securing your information with complex and varied passwords. Anything is better than using your dog's name for every online account. You'll feel more confident and protected - and your loved ones will have peace of mind too. Win-win.

Learn more about how you can stay safe online and protect yourself from fraud.

Orange County's Credit Union does not endorse any product or service provider described in this article. Orange County's Credit Union is not affiliated with any business listed in this article. Please refer to each apps Terms of Use for complete details regarding legal rights and obligations.

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