How Do Password Managers Work?

Passwords are essential for securing your online accounts and data. But they can also be a hassle to remember, manage, and enter. That’s where password managers come in. Password managers are tools that store and manage your passwords for you, so you don’t have to worry about them.

But how do password managers work? And why are they important? In this blog post, we’ll answer these questions and more. We’ll also show you how to get started with a password manager and recommend some of the best password managers for your business.

[Table of Contents]

• What Is a Password Manager?
• How Do Password Managers Work?
• Why Are Password Managers Important?
• How to Get Started With a Password Manager
• 5 Password Managers to Consider for Your Business

What Is a Password Manager?

A password manager is a tool that stores and manages your passwords for you. It helps you create strong and unique passwords for your online accounts and saves them in a secure vault. You can then access your passwords with a single master password or a biometric authentication, such as your fingerprint or face. Third-party password managers, unlike those native to your browser, provide extensions for all major browsers and apps for iOS and Android, so you're never stuck without your passwords. 

A password manager can autofill the username/password fields on websites you use, saving you time. It also syncs your passwords across your devices to access them from anywhere. Password managers designed for businesses provide relevant features, such as password sharing, the ability to give employees access to different folders of passwords, password auditing, and more.

Password managers are especially useful for businesses that manage multiple passwords for different apps, services, and users. They can help you improve your security, productivity, and collaboration.

How Does a Password Manager Work?

A password manager works by encrypting and storing your passwords in a secure vault. Encryption is the process of transforming data into an unreadable format that can only be decrypted with a key. The key is usually derived from your master password or biometric authentication.

When you create an account with a password manager, you need to choose a strong master password that only you know (and remember!). This master password is the key to unlocking your vault and accessing your passwords. You should never share or forget your master password, as it may be impossible to recover it.

Your workflow when you have a password manager looks something like this: you'll start each day logging into your password manager extension in your browser using your master password (or SSO if enabled). Then, when you log into your other accounts, you won't need to type in their password - you can use the extension to autofill your login information.

Online password managers integrate with your browser or device to make logging in even easier. They should offer browser extensions or mobile apps that allow you to access your passwords with one click or tap.

Some users may opt for offline password managers. While being totally offline is more secure, you'll have to contend with not having your passwords automatically synced across all of your devices. 

Why Are Password Managers Important?

Password managers are important because they can help you improve your online security and convenience. Here are some of the key benefits of using a password manager:

• You can create strong passwords: A strong password is one that is long, complex, unique, and hard to guess. A weak password is one that is short, simple, common, or predictable. Weak passwords are easy for hackers to crack or steal, while strong passwords are not. A password manager can help you create strong passwords for each of your accounts and save them for you.
• You don’t have to remember multiple passwords: Remembering multiple passwords can be challenging and frustrating. You may end up forgetting or mixing up your passwords, or writing them down somewhere insecure. A password manager can help you avoid these problems by remembering all your passwords for you. You just need to remember one master password or use your biometric authentication.
• You can log in faster and easier: Typing or copying and pasting passwords can be tedious and time-consuming. You may also make mistakes or encounter errors. A password manager can help you log in faster and easier by autofilling your passwords for you. You can also use browser extensions or mobile apps to access your passwords with one click or tap.
• You can protect your data from hackers: Hackers often use various methods to steal or crack your passwords, such as phishing scams, brute force attacks, keyloggers, malware, etc. If they succeed, they can access your data, accounts, or devices and cause damage or harm. A password manager can help you protect your data from hackers by encrypting and storing your passwords securely. It can also alert you if any of your passwords are compromised or reused.
• You can share passwords securely: Sharing passwords can be risky and complicated. You may expose your passwords to unauthorized people or lose track of who has access to what. A password manager can help you share passwords securely with your team members or colleagues. You can control who has access to what passwords and revoke access at any time.

How to Get Started With a Password Manager

Getting started with a password manager is easy and simple. Here are the steps you can take to start using a password manager for your business:

• Choose a password manager tool: There are many password manager tools available on the market, but not all of them are suitable for businesses. You should choose a tool that meets your needs and preferences in terms of features, security, pricing, support, etc. We’ll recommend some of the best password managers for businesses later in this post.
• Create a strong master password: Once you choose a password manager tool, you need to create an account with it and choose a strong master password. This master password is the key to your vault and your passwords, so make sure it’s long, complex, unique, and hard to guess. You should also enable two-factor authentication (2FA) for your account, which adds an extra layer of security by requiring a code or a device in addition to your master password.
• Log into your important accounts using the password manager: The next step is to log into your important online accounts using the password manager. The password manager will capture and save your passwords for you. You can also use the password manager to create new passwords for your accounts or change your existing passwords if they are weak or reused. You should aim to have a strong and unique password for each of your accounts.
• Implement security measures such as two-factor authentication: Besides using a password manager, you should also implement other security measures to protect your accounts and data. One of the most effective measures is two-factor authentication (2FA), which we mentioned earlier. 2FA requires you to enter a code or use a device in addition to your password when logging in to an account. This way, even if someone steals or guesses your password, they won’t be able to access your account without the second factor. You should enable 2FA for all your online accounts that support it, especially those that handle sensitive data or transactions.

5 Password Managers to Consider for Your Business

Now that you know how password managers work and why they are important, you may be wondering which password manager tool to choose for your business. There are many options available, but not all of them are equally reliable, secure, or user-friendly.

To help you make an informed decision, we’ve compiled a list of five password managers that we think are worth considering for your business. We’ve also highlighted their key features and benefits, as well as their pricing and support.

1. TeamPassword

TeamPassword is a password manager designed specifically for teams and businesses. It allows you to store and share passwords with your colleagues easily and safely. 

One special thing about TeamPassword is its easy-to-use design. It makes it simple to find your way around the tool. This not only makes it easier to use every day, but it also makes it easy to get started when new team members join.

TeamPassword is a tool that gives you what you need without any extra stuff. They offer discounts to nonprofits and live customer support via chat. Check out their pricing here. 

Here are some of the features of TeamPassword:

• Easy access: Team members can log in to their tools and services from almost any device.
• Simple interface: The design is easy to understand, so everyone can use all the features without any trouble.
• Sharing passwords: You can easily share passwords with your team or specific groups with just a few clicks. And if you need to limit access, you can do that quickly too.
• Password generator: TeamPassword can create strong and secure passwords for you automatically.
• Security features: TeamPassword takes security seriously. It offers extra protection like two-step verification and industry-standard AES 256-bit encryption to keep your passwords safe.

2. Keeper

Keeper is a password manager that puts a strong emphasis on providing detailed administrative insights and controls. It is specifically built to assist individuals and businesses in safeguarding their digital identities and ensuring the security of their online activities. Key features promoted by Keeper include robust role-based enforcement policies, delegated administration, comprehensive reporting on password activity, and event logging for over 140 event types.

In addition to its rich set of features, Keeper offers a fully-featured desktop application, which may be particularly appealing to certain users. Furthermore, there is an optional Secrets Management service available as an add-on.

While Keeper doesn't offer a free plan for personal use, its business plans are competitively priced, allowing businesses to benefit from its offerings at affordable rates.

For Keeper alternatives, click here. 

Keeper features:

• Manage and share passwords - Set up shared team folders and restrict who can add, remove, modify, and share records.
• Access to remote infrastructure - Enable employees to access sensitive internal resources with zero-trust network access from anywhere, on any device, with no VPN.
• Manage secrets - Remove hard-coded credentials from source code, configuration files, and continuous integration/continuous deployment systems.

3. Dashlane

If you’re looking for a popular and powerful password manager, you might want to try Dashlane. You can store, autofill, and share your passwords with confidence.

One of the coolest things about Dashlane is that it can change your passwords for you on many websites. This feature, called “Password Changer,” lets you update your passwords quickly and conveniently. You don’t have to waste time logging in and out of different platforms. Just click a few buttons and enjoy better security.

Dashlane also helps you create strong passwords that are hard to crack. It has a smart password generator that mixes letters, numbers, and symbols. By using complex passwords, Dashlane protects your accounts from hackers.

Dashlane has a simple and intuitive interface that makes it easy to use and manage your passwords. You can also access your passwords from any device with its browser extensions and mobile apps.

To find out more about Dashlane and how it compares to NordPass, read this blog post.

Here are some of the features offered by Dashlane:

• Password changer: With this feature, you can easily update your passwords on supported websites automatically, saving you time and effort.
• Dark web monitoring: Dashlane actively scans the dark web for compromised information and sends alerts if any of your data is discovered.
• Secured note: You can securely store sensitive information such as passport numbers or confidential business details within the app and choose to grant access only to trusted individuals.

4. NordPass

NordPass is a password manager created by the same team behind NordVPN. It's designed to be simple, secure, and user-friendly, making it easy to manage your passwords.

One standout feature of NordPass is its zero-knowledge architecture. This means that your passwords are encrypted and decrypted directly on your device, keeping them secure and ensuring that NordPass doesn't have access to them. This approach greatly reduces the risk of data breaches and unauthorized access to your accounts.

NordPass includes a password generator that can create strong and unique passwords for all your online accounts. It also offers browser extensions and mobile apps, allowing you to access your passwords conveniently across different devices.

Explore other options similar to NordPass by reading more here.

NordPass features:

• Unlimited password, credit card, and note storage: There's no storage limit to the number of passwords or other data you can store in your vault.
• Data breach scanner: The scanner alerts you when emails or passwords have been found in a data breach.
• Multi-factor authenticator: NordPass uses time-based one-time password (TOTP) and universal two-factor (U2F) authentication to secure your data.

5. Bitwarden

Bitwarden is a password manager that stands out for its security, affordability, and compatibility across different platforms. It's an open-source tool that emphasizes transparency and privacy, making it popular among users who prioritize these aspects.

With Bitwarden, your passwords are stored in an encrypted vault, ensuring their safety. The tool also provides multi-factor authentication options, adding an extra layer of security to your accounts.

One great thing about Bitwarden is its affordability. While there is a free version with essential features, the premium version offers additional functionalities like secure file storage and priority customer support at a reasonable price.

If you're interested in exploring other password management options similar to Bitwarden, you can find informative recommendations and alternatives in this blog post.

Bitwarden features:

• Bitwarden Send: This feature allows you to share encrypted information with another person, like passwords or credit card details, and set a self-destruct timer for it.
• Secure Notes: This feature serves as secure storage for other types of information that are not passwords.
• Vault health reports: These reports analyze the strength and security of your passwords and provide a score for each one. Using this data, you can mitigate future security concerns involving passwords.

Try TeamPassword Today

Having a strong and unique password for each online account is crucial for safeguarding your security and privacy. That's where a password manager comes in handy. It allows you to create, store, and utilize strong passwords, protecting them from hackers and identity thieves. Additionally, a password manager provides a secure space to store sensitive information, syncs passwords across devices, facilitates managing shared accounts, and helps you steer clear of phishing sites.

TeamPassword is a password manager specifically designed to meet the needs of teams and businesses. With TeamPassword, you can securely and efficiently share and manage passwords. It enables you to generate strong passwords, store them in a secure vault, automatically fill them on websites, share them with team members, monitor their security, and much more.

To experience the benefits of TeamPassword firsthand, you can sign up for a free trial today. See for yourself how it can enhance your online security and productivity.