I have an encrypted folder where I store an Excel file that contains all of my user ids and passwords. What I typically do is disconnect from the internet before opening the file, then close it before reconnecting to the internet. This is a royal pain. My question is the following. If I open my encrypted folder and Excel file while connected to the internet, am I exposed from a security standpoint?
A little easier would be to use a firewall that has the turn network off switch. Outpost Fe does but is now not updated. I think you are more vulnerable to having the password read from your clipboard
I don't think there is any great reason to disconnect from the internet. If the machine has already been compromised with something that could get the passwords a momentary disconnect would not make much difference and if not, then it doesn't matter.