If the information sent back and forth over your Wifi network isn't adequately encrypted, a hacker can easily tap into the network and monitor your activity. When you type personal or financial information into a Web site, that hacker can then steal that information and use it to steal your identity.

The old encryption standard Wired Equivalent Privacy (WEP) can be hacked within 30 seconds, no matter the complexity of the passphrase you use to protect it. Unfortunately, millions of Wifi users are still using WEP encryption technology to encrypt their information, despite the availability of the vastly superior WPA2 encryption standard.

The Problem: Despite the superior encryption protection that WPA2 provides, most Wifi home users have failed to upgrade their protection because they were unaware of the problem, or simply felt overwhelmed by the technical prospects of upgrading. As a result, many continue to use WEP encryption, which is now so simple to hack that it is widely regarded as little better than no encryption at all.

The Solution: The solution, of course, is to upgrade your Wifi encryption to WPA2. But before you can add WPA2 protection, you will have to complete a few steps in order to update your computer. The first step is to download and install Microsoft's WPA2 hotfix for Windows XP. You will also likely need to update your wireless card driver. These updates, if needed, will be listed in Microsoft's Windows Update page under the subheading "Hardware Optional".

Now that your computer and wireless card are up to date, you will need to log into your router's administration page through your web browser (this is the page you signed into in order to setup theWifi router the first time you opened it up, the specific URL can be found in your router's instruction manual.) Once signed in, change the security settings to "WPA2 Personal" and select the algorithm "TKIP+AES". Finally, enter your password into the "Shared Key" field and save your changes.