Online Savings Account Security

October 23, 2010

Online savings accounts are convenient but how do they keep your money safe online?  Most online savings accounts, whether they’re for an internet bank or online banking for your local bank, have pretty strict security standards to protect your money.

Here are the things you should look for from a security perspective when choosing an online savings account.

Secure Banking

Any bank these days will probably be using adequate encryption technology but you should always check.  You shouldn’t enter any personal information or your user name and/or password on any page who address doesn’t start with https.  If you see https you know they are using a technology called Secure Socket Layer (SSL) to prevent anyone else from accessing your information as it travels via the Web.

Email Security

A technique known as phishing is a common way for hackers and identity thieves to try and steal your login information.  They send you an email that looks like it’s from someone you trust, like your online bank, but when you click the link in the email it takes you to a fraudulent site instead of to your online bank account.

Your bank should include a portion of your customer or account number in your email to let you know it’s really from them.  For example, if your account number was 52048234, the email should contain xxxx8234 near the top. You don’t want it to be your full account number for security reasons but including the last few digits let’s you know it’s a legitimate email.

You also want a bank that never uses email to send or confirm personal information, such as account number, PIN number, or social security number.

Login Security

Personalized Authentication

Online savings accounts with the highest level of security have you setup a personalized phrase and image when you setup your online account.

When you’re on the bank’s login page and have given them your user id, they’ll display your custom phrase and image before they ask for your password.  If the image and phrase don’t match what you setup then you know something is fishy, a sign not to enter your password and proceed.

PIN Number

Some banks require you to setup a PIN number in addition to your user name and password. This can be difficult to remember at times and a bit inconvient but it does help increase the login security.  In my opinion it’s worth the extra hassle because it’s your money we’re talking about.

Security Questions

Similar to the personalized phrase, some banks will ask you to answer a variety of questions, such as “What color was your first car”, “What month did you get married”, or “What’s your mother’s maiden name”.  They usually give you a list of questions to choose from and ask you to answer 4 – 8 of them.

Then when you start to login you’re asked to answer one or two of the correctly before you’re able to finish the login process.

Computer Recognition

Some online banks let you register your primary computer so thier online banking software can recognize you when you visit the site from that computer.

For some banks this allows you to skip the security questions but that’s not the real benefit.  The man reason to do this is so that your bank can confirm your identity when you visit the site.


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Ben Edwards, the founder of Money Smart Life, saved up enough to buy a Nintendo back when he was 12 years old. When he used the money to buy shares of Wal-Mart stock instead, he knew he wasn't like the other kids... His addiction to personal finance has paid off for his family and now he's helping you to afford the life that you want. Check him out on the web at Google Plus, Twitter and Facebook.

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