Software installed in the user's computer, mobile device or in a physical unit that connects via USB. Password managers are built into Web browsers, and they are also available as a Web-based service, allowing for password retrieval from any computer, smartphone or tablet.
Advantage = Complex Passwords
The major advantage of password managers is that they create a complex and different password for each login site. Even when users create strong passwords with letters, digits and special characters, they often use a similar pattern on every site.
Disadvantage = One Location
If a user's computer is severely hacked, the thief has full access to everything within, including the password manager. If the user does not employ two-factor authentication such as a text to a phone or a biometric, the hacker could order merchandise shipped to a different address.
Although passwords are encrypted, all the passwords are in the password provider's server. One expects the most highly secured servers are employed, but if the servers were hacked, and they are from time to time, the crook has every password to every account people have.
A Tip to Securing Your Password Manager
One approach to making a password manager even more secure is to add a secret PIN at the end of each automatically generated password. Users have to manually append that PIN each time, but the same PIN can be used. If the password manager were ever compromised at either end, the attackers would not have the full password, because the appended PIN is the user's secret. See
password,
password security check and
FIDO.