Do you ever wonder what would happen to your business (or your life for that matter) if all of a sudden the internet and all its records were wiped out by some mysterious force or virus? Do you remember the fear surrounding the Y2K phenomenon at the dawn of the new millennium, how everyone was preparing for an apocalyptic outcome? I remember it well. And I also remember the widespread panic that ensued until it was finally over. It’s scary to think about what could happen if such an event ever manifested. And while it’s highly implausible, it’s certainly not impossible.
“The best way to prevent a calamity is to prepare for it.” Those were the immortal words of my late grandfather, who spoke very little, but when he did, it was profound wisdom. Think about it. What’s the best way to protect yourself from the fallout of a digital breakdown? I can only come up with one viable answer: make a hard-copy of every document crucial to your financial welfare and store them where they will never be compromised. I’m constantly reflecting on ways to protect myself from unexpected mishaps from banks, credit-card companies, cloud-based storage systems, and yes, even terrorist organizations. And you should too.
Let’s face it. We are living in a digital age. And we’re constantly being bombarded by requests from our banks and financial institutions to go paperless because it saves on the cost of producing and mailing statements. That may be true and beneficial to them, but it’s risky for you, especially if you don’t discipline yourself and follow up with a hardcopy.
Be careful about falling into the trap of complacency by relying or depending on someone else to look after you and your money. I say no way. No way am I going to put my trust into a system that has proven to be corrupt and that has basically wiped out a good portion of our wealth seemingly overnight (as in 2008) by unscrupulous bankers and greedy businessmen who gamble with our life savings and retirement assets. I harken back to the days when my astute grandfather laid down some simple attributes of good business that have instilled common sense in all my decisions. I don’t mean to sound so dire, and I’m not saying we should hunker down, bolt the latches and prepare for Armageddon. What I am trying to get across to you is to just be aware. Be aware of the possibility that something could go wrong. Electronic fraud, deceptions, and mishaps are running rampant on the web and are showing no signs of slowing down or stabilizing.
As an example of how things can sometimes go wrong unexpectedly and without any fraud in the equation: I used to keep all my financial information in a program called Quicken. Quicken is a software program that tracks and records all your financial information, such as bank deposits, check numbers, dates of transactions, etc. I’ve used this accounting software for many years dating back to the early 90s. In a surprise moment when I needed to access my records for tax purposes, I did not know that my new and updated computer operated with a processor that made my old files unreadable. I was in a quandary. But fortunately, because I heeded the advice from my guru grandfather, I had made hardcopies of all my files. You too can, and should, protect yourself and your assets by making copies of all your important documents.
Here is a partial list of ways to protect yourself:
Make hardcopies of all your bank statements received via electronic format, including personal and business every month.
Don’t rely on electronic documents. Make copies of all your invoices paid out to your suppliers and employees as well as all your tax receipts.
Keep a hardcopy of all your account numbers, serial and license numbers, and contact numbers for the institutions you do business with. The IRS will not feel sorry for you if you are ever audited and you cannot prove your numbers.
In the event of a mishap, like a flood or fire or some other catastrophe, take pictures of the damaged files or any electronic equipment, such as a hard-drive, storing such files. Take notes, mark dates, and get police and fire reports if possible.
In the aftermath of hurricane Floyd in September of 1999, all my financial documents, which were stored in the basement of my office building, were destroyed beyond recognition. Everything was lost. At the advice of my accountant, I took pictures of the damaged files and backed it up with a police report. In addition to making hard-copies of your documents, be sure you have a fireproof storage cabinet, and store your files in a location far above the water line.
If you prefer electronic (paperless) storage, there are several apps available that offer added protection and security by storing your files in a cloud-based storage system. Just type CLOUD STORAGE in your search engine. Cloud storage services may be accessed through a web service application programing interface (API) or by applications that utilize the API, such as cloud desktop storage (Dropbox.com), a cloud storage gateway or web-based content management systems (Redhat.com).
On a negative note, by sharing storage and networks over the internet, it is possible for other’s to access your data because of erroneous actions, faulty equipment, a bug and sometimes because of criminal intent. This risk applies to all types of file storage and not just cloud storage.
In closing, I will say this: I prefer to take whatever steps are necessary to ensure that if such an event ever happened, I’m in control. Remember, it’s your business, and only you can protect it.