What would you be more upset about? Losing your mobile phone or losing the data on it? The phone is worth a lot, hundreds of dollars. You can easily put a replacement value on it, and you might even have insurance for it. But you'd probably be more upset about losing what's on it: like your photos, your address book and text messages that you want to keep.
People tend to think of things like money, or jewelry, or real estate as assets. They are obviously assets. Even though a lot of our money transactions are done electronically now, those bytes of data can still be translated into cold cash. Money is a hard asset.
But many other things online aren't. They're digital assets. Their value is harder to pin down, which is why you've probably never though of them as assets before.
Passwords, photographs, your social media accounts, your online identity: all of these are digital assets you've spent time developing and are worth protecting. Here are four ways to protect your online world.
And, if you get into this habit now, it will pay off later. One of the reasons to take good care of your digital assets is to lay the foundation for the digital part of your estate plan (more on that in an upcoming column).
Treat your passwords with care. You love creating passwords, right? I know I do.
But your passwords are the key to your life online. You need multiple passwords, you need to keep an inventory and you need to update it frequently.
Make a list of every account you have, include the account number, the organization that you have the account with, and list the user ID and password. If you have a running list, you'll be less tempted to fall back on the crutch of using only one password for everything, which is a security risk. You'll also save time, because you won't constantly need to replace passwords you've forgotten.
One good technique: Create a single password-protected Excel spreadsheet, and make a few copies of it on different devices. You can also keep a hard copy. But don't make the mistake of putting it in your purse! Thieves can go old-school, too.
You can also use an app, like Password Box to store all of your passwords.
Back up your data.
This is a great way to protect photographs and documents you have stored. You can use a cloud-hosted service like Dropbox, take advantage of the regular backups that come along with your devices, or invest in a portable drive and a plan through a company like Seagate. My advice here is make the backup as automatic as you can. Think of it this way: you have no trouble buying insurance for your car or the hard drive of your computer. A backup plan is like insurance for everything that's stored on the computer.
Investigate an add-on to your home insurance.
Ask your homeowners insurance company if they offer a rider that protects against losses from identity theft, and if so, what it covers.
Tell someone about your digital protection plan.
Make sure someone else knows how to find your passwords, and about the other steps you've taken to protect your digital assets, in case something happens and you need a proxy to act for you.
For one more step to protect your digital assets, check out the Nest Wealth blog.