Should I Store My Bank Passwords in a Password Manager?

Storing your bank passwords in a password manager is the safest way to store them without putting them at risk of becoming compromised. When targeting online accounts, cybercriminals often target those that are most valuable, which includes your bank accounts. Securing your bank accounts with strong passwords is crucial to preventing bad actors from accessing them.

Continue reading to learn how a password manager helps secure your bank passwords and the additional benefits that password managers provide. 

What Is a Password Manager?

A password manager is a cybersecurity tool that aids users in creating, securely storing, sharing and managing login credentials for all of their online accounts.

With a password manager, the only password that a user has to remember is their master password. A password manager ensures that passwords are always strong and aren’t being reused across multiple accounts. 

How a Password Manager Secures Bank Passwords

A password manager secures bank passwords by storing them in an encrypted password vault that can only be accessed with the user’s master password. The master password essentially acts as the key to enter the vault. Password managers often provide you with the ability to add even more layers of security by enabling Multi-Factor Authentication (MFA), which we recommend enabling whenever it’s an option. MFA is a security measure that requires users to provide one or more forms of authentication in addition to their username and password. 

With MFA enabled on your password manager account, you will have to enter your email address and master password as well as an additional authentication factor or factors like a Time-based One-Time Password (TOTP) code from an authenticator app, or biometric authentication like Face ID. The more authentication factors added, the more secure your stored data will be. 

In addition to protecting them in your secure vault with a master password and MFA, password managers also secure your bank passwords by providing the strongest levels of encryption. Encryption is what converts your data from a readable format into ciphertext, which simply means an unreadable format that humans and computers cannot decipher. This ciphertext can only be decrypted using an encryption key, in this case, a master password. Encryption ensures that your passwords and sensitive data cannot be stolen, read or altered by an unauthorized user – providing you and all of your passwords, including your bank passwords, with ultimate security. 

Other Benefits of Using a Password Manager for Bank Accounts

Password managers do more than just secure your bank passwords – they also notify you of weak and reused passwords, aid you in changing passwords quickly, autofill your credentials, store images and files,and send you dark web alerts. 

Only have to remember one password

One of the major benefits of using a password manager is that the only password you have to remember is your master password. On average, a person has 100 passwords! Remembering 100 different passwords is difficult, so most people resort to reusing the same password or variations of the same password across multiple accounts. However, reusing passwords is a dangerous practice, because if one password is compromised, all of your accounts that use that password are vulnerable to being hacked.  

With a password manager, you won’t have to worry about having to remember multiple passwords because it stores them for you. You just have to remember one strong master password. 

Notifies you when passwords are weak or reused

Password managers simplify the process of tracking passwords. With a password manager, you’ll know when the passwords stored in your vault are weak, meaning they can be easily cracked. Password managers also let you know when you’re using the same password across accounts. This way you can take action right away by updating your passwords to ones that are strong and unique. 

Makes changing your passwords easy

Changing your passwords is crucial when you notice unusual activity on your online accounts or if you’ve recently discovered you were a part of a data breach. When you get into one of these circumstances, it’s important to have the right tools to aid you in quickly changing your passwords. With a password manager, you can quickly and easily change your passwords by using the built-in password generator. The password generator will generate a random, complex password that is nearly impossible for a cybercriminal to crack because it follows password security best practices. If your bank requires you to change your password after a set period of time, you can use the password manager to easily update the information that’s stored in your vault.

Autofills your credentials for you

Another benefit to using a password manager is that it’ll autofill your credentials when you go to log in to your accounts, saving you time and helping you become more productive. Not only does the autofill feature help with productivity, but it also keeps you safe from malware like keyloggers. 

Keylogging software is a type of malicious software that can be unknowingly installed on your device by a cybercriminal. It’s often used by cybercriminals to determine the sensitive data that individuals type on their computers like bank login credentials and credit card numbers. Because a password manager will autofill things like your passwords and card numbers, you won’t need to worry about them falling into the wrong hands from manually typing them. 

Stores more than just passwords

Password managers do more than just store passwords. They can also store identification documents, credit card numbers, sensitive files like home deeds and more. Sometimes you need to access sensitive information on short notice and a password manager provides you with access to that information wherever you may be, as long as you have it stored in your vault. 

Dark web alerts

A popular add-on that the top password managers offer is the ability to receive dark web alerts through dark web monitoring. Dark web monitoring constantly scans the dark web for information, like login credentials, that match the ones stored in your vault. If the dark web monitor detects that your credentials have been found on the dark web, you’ll receive a notification so you can take action right away by changing your password. 

Dark web monitoring allows you to take control of your sensitive data and mitigate the risk of compromised credentials. 

How to Choose the Right Password Manager

Choosing a password manager should be done carefully. Before choosing to invest in a password manager, ensure that it offers zero-knowledge encryption, read the online reviews and closely research that password manager’s reputation to ensure its security. 

Ensure the password manager uses zero-knowledge encryption

Zero-knowledge encryption is a security model that ensures only the end-user has the means to access their data. When a password manager is zero knowledge, user data is encrypted and decrypted at the device level with the user’s master password, and not on the company’s servers or in the cloud. Choosing a password manager that is zero-knowledge ensures that you have full control over your stored data and that the service provider does not have access to it at all. 

Read online reviews

You want the password manager you choose to fit your exact needs and reading online reviews can help you determine what you’re looking for. Some places where you can read online reviews about different password managers include G2, the Apple App Store and the Google Play Store. 

Look at the password manager’s reputation

A password manager’s reputation can reveal a lot about which companies you can trust with your sensitive information. Make sure the password manager you choose has a reputation for always keeping stored data safe, and is a password manager you’ll be able to trust with your most sensitive information. 

Keep Your Bank Passwords Protected From Cybercriminals

Bank passwords are among the most valuable passwords you can have, so it’s important that you protect them. Password managers are the best way to not only securely store your bank passwords, but also ensure they are always strong and can’t be easily cracked. 

See for yourself how a password management solution can protect your most critical passwords by starting a free 30-day trial.