As you grow your net worth and number of belongings, you may be considering opening a safety deposit box. Whether you want to store important documents, valuable jewelry, or gold coins, a safety deposit box is a good option.
Let’s look at what safety deposit boxes are, how to sign up for one, what you should and shouldn’t store in a safety deposit box, and how safety deposit boxes compare to other forms of storage, such as home safes.
What is a Safety Deposit Box?
A safety deposit box is a secure storage box in which you can store your valuables, and you can rent a safety deposit box at your bank or financial institution. When you rent a safety deposit box, your bank keeps a key to the box, and you keep a key, making the box more secure.
When you want to access your safety deposit box, you have to show a valid form of identification, just as you would if you were accessing your bank account. Generally, safety deposit boxes are reinforced to withstand natural disasters, including fires, floods, and hurricanes. This makes them one of the most secure options for your valuables and important paperwork.
Just like other financial accounts, you can assign a co-lessor to your box if they also need access to the assets or as an emergency contingency in case something were to happen to you.
How to Sign Up for Your First Safety Deposit Box
The process for signing up for a safety deposit box is different at every financial institution, but it’s similar to opening up a bank account.
- First, go to your bank and provide all the relevant paperwork, including your identification.
- Then, choose what size of safety deposit box is right for you. Most banks have different sizes that can range from about a foot long to almost two feet long.
- Determine the cost of the safe deposit box. According to Smart Asset, safety deposit boxes can range from about $40/year to upwards of $300/year.1
- Lastly, create the terms and access for your box. Will you have a co-lessor? How often will you need to access the box? You may also want to start a checklist of everything you’ll keep in your safety deposit box.
What Should You Put in a Safety Deposit Box?
Although safety deposit boxes are generally very safe, there are some precautions you should take when storing items. Be smart about storing important documents and valuables, even if the deposit box is at a bank.
When storing important documents, such as wills, trusts, birth certificates, or marriage licenses, never store the only copy in a safety deposit box. Instead, make a copy, and store one in the box. You may also want to store a digital copy on your home computer.
When storing valuables like jewelry or gold, take inventory of what you’re storing so you know exactly what’s in your safety deposit box. You may also want to take photos of your items in the safety deposit box so you have proof of their placement in case anything happens.
Lastly, don’t store anything in your safety deposit box that you need quick access to, such as your passport. It’s better to keep these items in a safe place at home.
Safety Deposit Boxes vs. Home Safes
For many items, safety deposit boxes are more secure than home safes because safety deposit boxes are more secure, thanks to the bank’s heavily protected vaults. Plus, they are fire and flood safe while many home safes aren’t. That being said, some items are better kept at home so you can easily access them when needed.
Safety deposit boxes are a great option for storing important valuables and paperwork because they are more secure in a bank or financial institution.
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Since 2004, TCM Wealth Advisors has been providing Fee-Only Fiduciary Advice to our clients in Northeast Ohio (Akron/Canton, Cleveland), and around the country.
This content is developed from sources believed to be providing accurate information, and provided by Twenty Over Ten. It may not be used for the purpose of avoiding any federal tax penalties. Please consult legal or tax professionals for specific information regarding your individual situation. The opinions expressed and material provided are for general information, and should not be considered a solicitation for the purchase or sale of any security.