What Is Data Privacy and Why Is it Important?

Data privacy has become an increasingly important part of our culture. It’s something we need to think about all the time, whether we’re ordering products online, using a computer in a coffee shop, or running your own business. But what exactly does data privacy mean and why is it so important? The guide below will hopefully answer these questions for you so that you can properly protect all the data in your life going forward.

What is Data Privacy?

Data privacy refers to how we handle a specific piece of sensitive information. If every single piece of information about you was available to the public, it would likely be catastrophic. Before long anyone could access your bank account, take out a loan in your name, or browse your personal files.

However, we don’t need to protect each piece of information to the same degree. While you likely don’t mind if an eCommerce website knows your first and last name, you probably don’t want them to have your social security number. There are certain pieces of information about yourself – known as Personally Identifiable Information (PII) or Personally Health Information (PHI) – that you will only want to give out when you’re certain they can remain safe and secure.

According to this CCPA article from Prolifics, “Data privacy is a facet of data security that focuses on the way that data is handled from inception to long term storage and implementation. Data security as a whole is the practice of protecting data from becoming compromised, either from internal or external attacks.”

Data privacy, in short, refers to keeping all sensitive information protected, allowing only the right people to see it.

Why Data Privacy is Important in Your Personal Life

No matter who you are or where you are in your life, it’s essential that you protect your personal data. Take the following example:

John receives an email alerting him that there is an issue with his tax return. He opens the link within the email, and promptly enters his contact information, social security number, and bank account information. The problem is that the email he received is a scam, and now hackers have access to his most personal information.

With this information, they are able to steal John’s identity and alter his financial situation. They take out loans under his name, withdraw funds from his bank accounts and retirement funds, and pile up a large amount of credit card debt. It will take John months, maybe even years, to get out of this financial hole and get his life back on track.

Why Data Privacy is Important in Your Business

Just as it’s important for your personal information to remain secure, the same concept applies to business data. Imagine you are running your own tech company. Within it, you have a ton of data, from employee records to customer information to proprietary data about your products. Should any of this become exposed, your business would be in significant trouble.

For example, let’s say Prestige Tech didn’t set a strong enough password to one of their databases. Hackers guess what it is and are able to see all the sensitive information inside. If this database were full of customer records – such as their name, contact information, and bank accounts – the hackers could sell this information or release it online. Once customers found out about the data breach, Prestige Tech would likely lose many of their customers and could even face legal consequences.

How You Can Protect Your Data

There are a few simple practices you can put into place that will help you protect your data.

#1 – Protect Your Paper Documents

Even though a lot of your data is transferred online, you still need to protect your physical documents. To start, you should consider placing a lock on your mailbox so that no one can get into your mail. Beyond that, you should shred any documents with personal information on them before you put them into the trash. Invest in a good shredder for your home or office, then keep it right next to your garbage can so you don’t forget to use it.

#2 – Use Strong Passwords

Another simple thing you can do is use strong passwords for every account you create. The more complicated you make your password, the less likely it is that someone will be able to guess it. To have a strong password, it should include:

• At least 8 characters
• Both letters and numbers
• Both uppercase and lowercase letters
• A symbol

Once you start creating so many complicated passwords, it may become difficult to track them all. Don’t resort to keeping them on a piece of paper by your desk or in one unprotected file on your computer. Instead, invest in some good password protecting software.

#3 – Only Use Protected WiFi

One of the more common ways that hackers gain access to sensitive information is through unsecured WiFi networks. Whenever you want to connect to the internet using WiFi, you should make sure you are on a secure network. At home, this means using a high level of encryption, such as WPA, and a strong password.

For networks outside the home, you should avoid using public WiFi networks. If you are going to use one, make sure file sharing is turned off among devices and try to avoid sending any private information while you are on the network. For example, sitting in your local coffee shop may not be the best time to file your taxes online or do online banking.

#4 – Share Information Only on Reputable Sites

Before you send any information online, make sure the site you’re on is reputable. If the site you’re on starts with “http” rather than “https”, you should avoid submitting sensitive information like credit card numbers. You should also double-check to make sure you’re not on a scam website. Here is some more information as to how you can detect scam websites.

#5 – Implement Privacy Policies Business-Wide

Finally, data protection policies won’t do much good if you’re the only one following them at the business. Set up some standards that you expect every employee to follow, then take the time to ensure they are being followed. It’s also good practice to change passwords or remove access to files from anyone who has been let go by the company. This guide on protecting data at work has more strategies if you need them.

Make Data Privacy a Priority

Having sensitive data in the wrong hands – whether it’s your own data or your businesses – is a tremendous hassle in the best of cases. But with a few simple practices and by being a little more careful when you share sensitive information, you can likely prevent this from happening.