Online banking is now as common a way to access your accounts as stopping at an ATM, with three-quarters of Americans who have accounts making it a habit, according to the Federal Reserve.
But you know who else loves online banking? Hackers. After all, it's easier to steal your money from far away than while standing in line at the teller window. Banks and credit unions are beefing up their security systems to fight cybercrime. But consumers also have a role to play. Here are five steps to take to protect your accounts so you can bank securely online.
1. Ask for two-factor authentication. When you log in to a website, you prove who you are by entering a username and a password. That's one factor. With two-factor authentication, you're asked to enter another piece of identification, such as a temporary code. The bank would e-mail or text you the code at the time you try to log on, so it's unlikely someone else could receive it beforehand.
2. Skip public Wi-Fi. You can't really tell who can see your data if it's being sent over public Wi-Fi, the kind offered at such places as coffee shops and hotel lobbies. Basic web surfing on these public networks might be OK, but it's best to do your online banking from the security of a private home network, said Doug Johnson, senior vice president for payments and cybersecurity policy at the American Bankers Association. If you travel often and need to use mobile banking, consider choosing your mobile provider's data plan for online access. If you have to use public Wi-Fi, another option is to set up a virtual private network, or VPN, to send and receive encrypted data online. You can do this for a few dollars a month.
3. Set up reminders to change your password. When you open an account and sign up for online banking, you are probably asked to create a strong password. That's good advice. In addition, it's a good idea to set up reminders on your task list or calendar to change to another strong password every few months so that it doesn't become stale and guessable. Along these lines, avoid having the same password for all your online accounts. Keep your passwords distinct and varied.
4. Be wary of 'official-looking' notices. Some scammers send e-mails that claim to be from a bank, asking you to click on a link to settle some issue with your account. These e-mails might have the right logos and language, but Johnson said it could be a phishing effort to get you to give up your username, password, Social Security number or other sensitive data. "Phishing attempts are becoming increasingly sophisticated," he said. If you receive an e-mail that is even a little suspicious, don't click any links in the message. Remember that you can always sign in to your account by opening a new web browser session and typing in your bank's web address.
5. Ask your bank how it's keeping your records secure. Take a look at your bank's website, or contact customer service, to learn about any encryption technology it uses, whether it monitors accounts for fraudulent activity and if it limits your liability for unauthorized transactions. If you are not satisfied with the answer, consider switching to a bank where you will be.
Margarette Burnette is a staff writer at NerdWallet, a personal finance website.
