There has been lots of talk lately about company server hacks. You have probably heard about the Sony incident where millions of data sets were downloaded by hackers. Last Pass, the company behind the password manager of the same name, noticed irregularities as well and asked their users to change the master passwords of their account.
A local password manager like KeePass would have been especially helpful in the LastPass case, as your data would not be exposed on the Internet at all. The fundamental difference between online and offline password managers is the storage location and responsibility. Online password managers like LastPass store the account logins and information in the cloud, while offline password managers store login related information on the user’s computer.