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Worst: Your own internal memory
Passwords are the great curse of the modern Internet user. The more you use the Internet, the more you rely on passwords, and the harder it gets to use them properly.
To use passwords properly you need to make them complex, not reuse them on different sites and change them periodically. Not many people really follow through on all this, but some password management methods make it easier than others.
The first one, the one everyone uses at first, is to remember them. This has the benefit of simplicity, but it's not really sustainable. If you have 50 different sites with passwords, can you really remember 50 different complex passwords?
So people come up with tricks to remember them. One is to use one password and attach a site-specific prefix or suffix, e.g. fl00rb0ard.FB and fl00rb0ard.Twitter. This helps a little, but if one of your passwords is compromised, all of them are.
There are more complex ciphers that some people use to make the specific password less obvious, but the more you obscure the result the more you give yourself to remember.
The image nearby, a well-known XKCD cartoon, illustrates some of the issues with password ciphers, but the cartoonist misses one point: It's just one password. What about the other 49?
And if you need a strong and unique password, you can generate one at correcthorsebatterystaple.net.
Previously on Six clicks
Barely there: A piece of paper tacked up next to your desk
This one depends on your physical surroundings. If you use your passwords from one private location, this could be a good solution for you.
The fact is that the threats to most users' passwords are online threats, not physical threats. Another advantage of this technique is that normal people can relate to the risks more clearly than they can to the risks of using passwords online.
On the other hand — obviously — anyone who can see your list can read it, take a picture of it, etc.
Image courtesy Dan at TheDailyPrep.com