Strangely formulated question but:
- yes of course you can encrypt/decrypt data in java
- yes bouncy castle can do it but you can also do it without bouncy castle
- bouncy castle is an awesome library but can be rather complex to work with
- yes you can perform the encryption/decryption entirely in memory though you should consider whether or not your swap is encrypted as well, otherwise it won't matter
Do you want PBE (password-based encryption)? I would assume so otherwise you need to consider other aspects like how/where to save the keys.
In short: security is hard.