In Security for the Paranoid, Mark Burnett talks about his computer security methods after other Security profesionals say he is too Paranoid. 'Paranoia is the key to success in the security world.' He requires his kids to use at least 14 character passwords on his home network and is now considering issuing them smart cards.'
Being paranoid is fine -- but it's only 1% of the battle -- and it makes no sense to run around closing up every possible hole you find.
A security expert is supposed to identify ALL of the possible ways in which the organization may experience a negative impact as a result of poor security (both logical and physical). His job, brace yourselves kids, is not to close all of the holes!! Rather, his role is centered around determining the cost/benefit of taking care of each specific issue. If there's a 0.5% risk of a particular security hole costing a large organization only $1,000 in damages and cleanup, and closing that hole will cost $5,000 in man-hours and hardware, it's pretty clear what the correct choice is. On the other hand, the risk may be low, and the cost may be low, so you just do it. Or the risk me be high, and the cost high, so you STILL do it... you get the idea.
Being paranoid is fine -- it will help you identify security problems that others may or may not see. However, what to DO about the holes you find is where the real work begins.
I can't imagine a cost-benefit scenario that justifies issuing smart-cards to family members on a home network. This guy has officially achieved 'retard' status.