Holiday shopping online makes better sense than shopping in the malls. You can save loads of time and avoid the crowds. You can find bargains, an amazing selection and even track shipments. But it's not without risk. Many feel uncomfortable giving out their credit card to unknown website. Identity theft is a real concern. But there are ways to drastically reduce your risk. These tips are good all year long, not just for the holidays.

Basic security is first. You must be sure your computer, your browser and your wi-fi are secure. Your operating system and applications must remain up to date. Every expert recommends multiple layers of security and regular backups. Before you venture out for an online shopping spree, make sure basic security are taken care of.

Never use public or unfamiliar computers when shopping or banking online. You have no way to tell whether those computers are infected with malware. If they are, you have no defense. Don't shop or bank from public wi-fi networks. It's too easy for others to monitor your communication.

Always use strong passwords where money is involved. Eight or nine character passwords are no longer good enough. Experts say 12 character passwords are now required to stand up to the ever increasing power of computers. Using numbers and special characters makes passwords even more difficult to crack.

Never use a debit card for shopping online. Laws limit your losses when using a credit card but debit cards don't have the same protection. One way to limit your risk is to use a separate credit card for online purchases. Should the card ever be compromised, the repercussions won't carry over to your everyday credit card.

Another way to limit risk is to use PayPal or other 3rd party service to pay for purchases. The advantage is that when you pay by PayPal, your credit card number is not used in the transaction. The fewer servers your credit card number is stored on, the lower your risk for loss or identity theft.

Another way to reduce the risk of using credit cards online is to use prepaid credit cards. These cards are available in most grocery and drug stores. You can add as much or as little money to these cards as you need. Each one has its own number so there's never any need to reveal your own credit card number. In addition, your loss is limited to the amount of money on the card. When buying prepaid cards, be sure to read the fine print and watch for high fees.

'Virtual' credit card numbers are also known as 'disposable' numbers or 'one-time-only' numbers. These numbers are used in place of the number on your physical credit card. This option is now offered by most major credit card companies. They usually are good for a one-time use or they expire after 30-60 days. Should the bad guys obtain a disposable number, it does them no good at all.

When you're ready to make a payment at a website, be very sure that your connection is secure. An icon of a padlock should be visible in the bottom right corner of the screen or in the URL bar. In addition, the website address should start with "https." If you see neither of these signs, you shouldn't trust the website. Another security tip: never save passwords in your browser. It's the first place criminals will look should they get into your computer. One last tip - always be sure to log out of your browser when you're done shopping on a website.

Your risk of identity theft and monetary loss can be drastically reduced if you simply follow the suggestions above. These tips, along with some common sense can help make you holiday shopping online both safe and enjoyable. - 39969