Updated on September 27, 2023.
A password manager is a tool that provides users and businesses with the ability to track, store, protect, share and manage login credentials for applications and online services in an encrypted vault.
Password management solutions are crucial to keeping users safe and secure online. As cybercriminals increasingly infiltrate networks, it is important that businesses and individuals take the necessary steps to ensure their accounts are secure.
Continue reading to learn how a password manager works and why you should use one.
How Do Password Managers Work?
Password managers store passwords in a secure, cloud-based digital vault. This allows users to access their login information anywhere, using any device. Users can access their password vaults through the password manager’s web application or by downloading the desktop app, browser extension or mobile app.
To unlock the password vault, users need a master password which is the only password they need to memorize. The digital vault allows users to add, edit and manage private information such as passwords and files.
Are Password Managers Safe To Use?
Yes, password managers are safe, effective security tools that greatly decrease the risk of data breaches, ransomware and other password-related cyber attacks. Password managers use strong encryption to protect the stored information in their vaults and keep cybercriminals from gaining access to their vaults. Only those with a master password have the ability to decrypt and view the stored information.
Benefits of Using a Password Manager
Using a password manager is one of the best ways to stay safe online. It helps protect you from cyber threats and makes managing your personal account credentials and information much more convenient. Here are some benefits of using a password manager.
Manage your passwords in one place
It’s extremely difficult to remember multiple passwords, which is why so many people resort to poor password habits. According to Keeper’s 2022 US Password Practices Report, 56% of respondents use the same password across multiple accounts.
Password managers take away the stress of having to remember your passwords by storing all of your passwords in one secure place, allowing you to modify them at any time. They also provide a password generator to help create strong and unique passwords for all of your different online accounts. A password manager can even identify weak passwords and suggest ways to strengthen them.
Prevent phishing and identity theft
Phishing is the most common type of cyber attack that results in users losing their confidential information. Phishing is when a cybercriminal sends a fake message, typically in the form of an email or text message, to trick a person into revealing private information or unknowingly downloading malware onto their machine.
Password managers can prevent users from falling prey to phishing attacks. When a user adds the login credentials to their password manager, the password manager stores the website linked to the online account. When the user logs in to their account, the password manager autofills the login credentials to the website.
Conversely, if a user clicks on a link in a phishing email and is directed to a spoofed website, the password manager will not recognize the URL, and the login credentials will not be autofilled. This is a red flag for the user, indicating that they are not visiting the site they thought they were.
Share sensitive information securely
Under certain circumstances, you may need to share access to an account. A password manager tool ensures that employees and individuals can share account credentials easily and securely without having to memorize the shared passwords, write them down or send them using risky methods such as email or text messages.
What Happens if You Don’t Use a Password Manager?
Not using a password manager puts your passwords and accounts at risk of being breached by cybercriminals. For example, if a device is infected with keylogging malware, cybercriminals can record all of the passwords that the user types. Because password managers autofill login credentials, there is no key pattern to be recorded.
With a password manager, you’re not only protected from the most common cyber attacks, but your online security becomes seamless. Without a password manager, you have to memorize all of your unique passwords on your own, which usually results in people reusing the same ones. These dangerous practices are a trap that many will fall into simply because they don’t have the right cybersecurity tools. A password manager aids you in following password best practices.
What To Look For in a Password Manager
Password managers help prevent data breaches and accompanying financial losses. However, with so many options on the market, it’s easy to feel overwhelmed when evaluating password managers. Let’s break down some of the key features to look for.
Encryption is the process of scrambling data from a readable format known as plain text into an encrypted text known as ciphertext. Zero-knowledge encryption is a security model that uses encryption and data segregation to make data breaches ineffective. Zero knowledge ensures that even if a password manager service is hacked or compromised, cybercriminals cannot access user passwords or other sensitive information. It’s important to note that not all password managers are truly zero knowledge.
Your password manager should comply with the software regulations to ensure a certain standard of security and protect the data and privacy of consumers and businesses.
Here are some regulations your password manager should follow:
- Federal Risk and Authorization Management Program (FedRAMP)
- General Data Protection Regulation (GDPR)
- Payment Card Industry Data Security Standard (PCI DSS)
Compatible with your systems and software
A good password manager works cross-platform, with all of your devices, including your phone, tablet and computer. It also needs to be compatible with all of your Operating Systems (OS) on your devices such as Windows, Mac and Linux.
Multi-Factor Authentication (MFA) support
For an extra level of security, ensure that the password manager supports multi-factor authentication. When MFA is enabled, users are granted access to a website or application only after successfully providing two or more pieces of evidence to prove that they are who they claim to be. For example, in addition to providing a password, the user may be required to:
- Provide a security code from an email, text message or app
- Answer security questions
- Pass a fingerprint or facial recognition scan
Customization and flexibility
Not all password managers are the same. Most password managers offer different plans for different users. You should consider what type of plan you need when looking for a password manager that fits your needs. Here are some common plans that password managers offer:
Personal and family plans: Ideal for individual users and families who are looking for a simple way to protect their online accounts, using any device.
Business and enterprise plans: Designed for companies that require accounts for individual employees, plus an admin console where IT administrators can enable and disable accounts, monitor employee password use, run reports and perform other administrative functions.
The features and benefits of password managers can vary widely between vendors as well. While some features are included in the basic package, others are typically add-ons that incur an additional cost. Common add-ons include:
Dark web monitoring: Notifies users if their account credentials have been found on the dark web.
Secure messaging: Hyper-secure messaging that eliminates the risks associated with data leakage and unencrypted communications.
Concierge service: 24/7 expert customer service and support.
Keep Yourself Safe With a Password Manager
Keeper Security offers a variety of packages to fit the needs of anyone and every organization. With features and add-ons including BreachWatch, One-Time Share, KeeperFill and more, your passwords and sensitive information are securely stored and protected. Protect your passwords by signing up for a free trial of Keeper Password Manager for you or your business.