Personal Finance Websites – Are They Safe?
Sites like Mint.com and www.CreditKarma can be valuable tools for managing your money. Mint uses your actual financial transactions to help you budget for the future. CreditKarma tells you your credit score and what factors in your financial life are affecting it. They both can help you get a handle on your finances and accomplish goals like buying a home. But, is it safe to
share that personal financial information? Privacy expert Eva Velasquez recently shared her views with the finance site Marketplace.org. In a nutshell, here is what you should consider before trusting your financial information with a money-management site:
Balance Convenience with Risk
These sorts of sites store your information in the cloud; this means, your data is out there in someone else’s servers. Look into what sort of security the site provides. Do not pick any that use security measures that fall short of the encryption you would expect from your bank. Often, you will see this described as SLL or TLS encryption. Without getting too deep into the technical details, this means that the site uses a combination of measures to make sure your information is safe.
You should also change your passwords regularly to keep everything as secure as possible on your end, as well. Often, the end user is the weakest link in any program’s security; be a stronger link and keep your data safe.
How Much Is Your Information Worth?
The other factor to consider is that personal finance websites like CreditKarma offer their services at no charge because they have a different product: you. This site, like many others, sells your data to advertisers, who, in turn, use it to more accurately target products at you.
To some people, this is an unwanted and excessive invasion of privacy. If this describes your attitude toward this sort of targeted marketing, these free money management sites are not a good match for you. You would be better served by downloadable budgeting software and purchased (or free annual) credit reports.
On the other hand, if you do not mind the ads, go ahead and use the sites. Velasquez told Marketplace.org that people’s comfort with this practice seems to be generation-based. Baby-boomers are generally uncomfortable with the data sharing. But, millennials who grew up with GMail ads based on the contents of their emails tend to either not mind the data-usage or even enjoy having products directed at them.
Online money management programs can be an excellent tool for keeping you on track toward your financial goals. Just stay aware of how your information is used and how it is protected to get the most out of a program while minimizing your risks.