I will recommend you using ssh-keys in order to use secure authentication and to make your general experience a lot better. If you already have an openssh-client and Visual Studio installed you can go ahead and install the Remote Development extension package.

macOS 10.14+ (Mojave) SSH hosts with Remote Login enabled.

Windows 10 / Server 2016/2019 (1803+) using the official OpenSSH server.ARMv7l (AArch32) Raspbian Stretch/9+ (32-bit).On the Remote server you need to have an SSH server On your Local machine you need to have a supported OpenSSH compatible SSH client A few examples are the Remote SSH, SSH FS, Remote X11 Prerequisites and System requirements However, you are free to use other extensions as well. I find it really easy to use and it was also quite simple to configure it as well.

I personally use the Remote Development extension. There are several extensions that will help you to achieve this. If you run multiple servers and you do not want to edit files and open folders using ssh client and text editors like vim, vi or nano and you want to take advantage of all the features of Visual Studio Code then this tutorial is just for you.

Visual studio code ssh fs