The best policy to have is to keep separate passwords for all of your different accounts. I know this isn't easy, but have the best security never is. People should also change their passwords from time to time and just not by incrementing values or numbers like 'password1' and 'password2'. These are too easy to guess and automated password crackers use those type of algorithms.
There are password utilities that can store you passwords for you and these utilities use the latest encryption, but if you forget that one password, you are in trouble.
Now there is news that a hacker in Australia is breaking into and locking iPhones and iPads using the 'Where is my iPad' feature. When you feel your passwords or accounts have been breached, it is the best policy to change ALL of your passwords. You can never be too safe when it comes to online security.