How to keep your retirement accounts from being hacked

Feb 26, 2020

[vc_row][vc_column][vc_column_text]hacked retirement accounts


According to the American Institute of CPAs, 8 out of 10 Americans are concerned that financial institutions and other businesses may not be able to safeguard their personal information. Unfortunately, just being concerned your retirement accounts might get hacked won’t help protect your information. Taking action is the best way to avoid identity theft or anyone robbing you of your financial future. After all, it’s always better to be safe than sorry, right?

So, if the thought of losing your retirement savings keeps you up at night, here are the best ways you can keep your retirement accounts safe.


Regularly review your accounts

Usually, it’s not recommended to frequently review your retirement accounts as market volatility can potentially leave your account balance smaller than you may have anticipated, causing panic and tempting you to make a poor investment decision.

However, investments aside, you should regularly review your account history and transactions to check for any unauthorized changes or charges. It’s also wise to set up alerts with your retirement account custodian. Custodians can set up notifications to alert account holders of login activity, password changes, and any other transactions. If you do see some suspicious activity on your account, you’ll want to contact your custodian right away.


Secure your accounts

It’s important to be extremely cautious when managing sensitive information such as your Social Security number, passwords, usernames, or even your date of birth. You can never be too sure when this information might end up in the wrong hands. Hackers or thieves may keep your information on file and not use it for months or years, waiting for the perfect opportunity.


Here are a few ways to keep your information safe:

  • Use a password generator: To protect all your passwords, use a password generating tool like LastPass. With LastPass, you can generate random, yet strong passwords and store them to keep your retirement accounts safe.
  • Download a two-factor authenticator: You may also want to consider using a two-factor authenticator such as Google Authenticator. You can download an authentication app right on your phone. Then, when you need to log into an account, you’ll be given a code to enter to access your accounts. With two-factor authentication, you add an extra layer of protection to all your retirement accounts.
  • Use caution when sharing financial information on websites: Pay close attention to the institutions or sites that store your personal information. If you enjoy shopping online or have subscription services, it’s relatively easy for hackers to steal this. Therefore, don’t save your financial information with online retailers.
  • Create a virtual private network (VPN) for your home internet: Once hackers gain access to your home internet, they also gain access to information on your devices linked through your internet connection. That’s why you should consider creating a VPN which provides an encrypted tunnel where you can send and receive data. You’ll also want to change the Domain Name System, which your service provider will give you when you set up the service.


Update your devices and software

Updating your devices and software not only provides a system update but often comes with enhanced security measures. Always remember to keep all your devices up-to-date.

Cybercriminals regularly use exploits or flaws in your software to access your personal information. By updating your software and patching those flaws, you’re less likely to get hacked.


Be cautious of unexpected calls from your custodian or bank

If you receive a phone call from your bank or custodian stating they need some of your personal information, tell them you will call them back. Politely hang up the phone and look up the number on the back of your statement. This way, you can be sure it’s actually your bank or custodian trying to reach you. Even if the caller ID says it’s from your bank or custodian, caller ID spoofing allows hackers to hide behind a legitimate financial institution’s contact number.

Hackers may also try this tactic to access your Social Security benefits. In this situation, a hacker may pose as a Social Security Administration official and say they are calling to verify your information. While the Social Security Administration has confirmed that they do call beneficiaries, it’s wise to double-check the number and contact the Social Security Administration for authentication.


Freeze your credit

In 2018, federal law made it so that consumers could freeze their credit (with all three credit bureaus: Experian, TransUnion, Equifax) for free. Credit bureaus have made it easier for consumers to block or unblock their credit even on the go. When you block your credit, you are prohibiting anyone from opening financial accounts on your behalf. This means that if a hacker went to apply for a credit card using your information, they wouldn’t be approved because your credit is blocked.

It’s important to note that you will have to freeze your credit with all three credit bureaus. You can visit their websites or call them to get the process started. Even if you’re retired, you’ll want to freeze your credit right away.


Partner with a financial planner you trust

Unfortunately, hackers aren’t the only thieves that want access to your money. Sometimes even financial advisors steal from their clients. Recently, former Morgan Stanley advisor, Elias Herbert “Bert” Hafen, stole about $1.6 million of his own client’s money. He did this by creating fictitious account statements and a non-existent investment company. Instead of investing in his special fund, he would use their money to support his lifestyle. Fortunately, he got caught and now faces up to five years in prison.

That said, it’s easy to assume all financial professionals have your best interest in mind, but this is simply not the case. To avoid falling victim to one of these fraudsters, do your homework. To review a financial advisor’s credentials, you can visit BrokerCheck by FINRA. You may also want to ask them questions such as how they get paid or if they are a fiduciary. By taking the time to review your financial planner’s background and credentials, you can make a better decision about who you choose to partner with.


The bottom line

Keep in mind, that many custodians have measures in place to protect your accounts. From signature verification to completing multiple forms, it’s unlikely that your accounts will get hacked. However, to be extra cautious, you should follow the steps above. While hackers may struggle to access your retirement accounts, it may be easier to gain access to other information like your credit card credentials.

If you’re looking for a financial planning partner who can help you maintain good financial habits, we have financial planning offices in Redmond, Seattle, Mill Creek, the Tri-Cities region, and Denver. Our firm focuses on helping retirees and those preparing for retirement achieve financial freedom by creating a plan that shows them how they can have the income they need and want until they turn 100.

If you’re ready to take the first step in achieving your retirement goals, our team is ready to assist you. We’ve helped hundreds of couples and individuals smoothly transition with confidence, and we’d like to do the same for you.





Providing for family, spending time with grandkids, traveling. You shouldn’t be wasting your golden years worrying about electric bills or the balance of your checking account. We’ve helped hundreds of people retire confidently and we can’t wait to do the same for you.

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