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I'm trying to improve my wife's password hygiene, and have now finally got her to use different passwords for different sites. She now has trouble remembering to keep the book of them to hand. She flatly refuses to learn to use another program, like KeePass (Excel, Zoom and a web browser are pretty much her limit).

Even using a password manager, malicious installation of a keylogger would be game over for bank details and the like.

System and use. ADSL router with its standard 'firewall', wifi to several machines including her win10, with the standard Microsoft Security running on it, updates accepted when offered, but no third party antivirus. No illegal or even unusual browsing done on it, it's just used for online shopping, banking, facebook and zoom. It doesn't leave the house, and doesn't get used with random USB sticks. She seems reasonably savvy about phishing, and often asks for my approval before opening emails. I am the only admin user on it.

What exploits could access a simple unencrypted notepad file of passwords on her machine? How much more dangerous is that to have than an encrypted file or a password manager? The only one that springs to mind is having the machine stolen or lost, unless it's possible to remotely access files without actually installing software.

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    This looks a lot like "I want to steal my wife's passwords"
    – ThoriumBR
    Oct 26 '20 at 21:45
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Keyloggers and the like are not "exploits", but are merely malicious programs that may execute as the payload of an exploit or after tricking the user into running them.

But you seem to have identified the problem; if there is malware on the computer, it could read the text file containing passwords. If the password file is encrypted, it could likely just steal the password with a keylogger, or grab the unencrypted database out of memory. Everything on a compromised computer should also be considered compromised.

It depends on a lot of things, but the most likely vector for a home user is probably downloading and executing untrusted programs, which could access all of your user data, or even take over the entire system if granted administrative privileges.

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