Cloud computing has become a buzz-phrase that many are asking about. What is it? How does it work? Can I use it?
Cloud computing simply involves having your servers run offsite. So think of it as moving your server room to some remote location where there are professionals running that server for you. That is, with one exception: you do not own the server, instead you rent server space. Not a bad idea considering it has been around for a long time, and now companies like Amazon, Google and Microsoft are offering these services. The obvious benefits are that you do not have to worry about managing servers, their potential breakdown, or upgrading them. All of that is maintained for you, including backups.
Unfortunately, if you are not tech savvy you will still need a tech person to “manage” the software running on the servers—upgrades, changes, etc. The Cloud people will tell you they can do it for you for a price, but they really do not understand the financial planning business.
You might be thinking, Will all my server software work on the Cloud? … Well, no. Most of the software should work, but if you are running integrated software there could be a good chance it will not.
Before making the decision, remember you are still responsible for security of data as well as other compliance items such as backup. So read and understand the Cloud backup and recovery process, and make sure you have a test in place. If you do decide to have data on the Cloud—being transferred via the internet—how are you ensuring that the data is secure? The Cloud company can help you with this, but make sure you understand and feel comfortable explaining it to regulators. Lastly, make sure it is worth the cost. Crunch the numbers; if they work, I am sure you will not be disappointed.
Ash Bhatnagar, CFP®
RIA Independence Co.