You can usually do this through your homeowner's insurance. Therefore, you are responsible for insuring any valuables you store in your safe deposit box. The FDIC or the National Credit Union Administration does not insure safe deposit boxes. This allows the money to accrue interest rather than collecting dust in a safe deposit box. Ideally, you'd put it in a long-term CD if you don't need it soon. Second, if you're going to keep cash in the bank, put it in a bank account where you can earn interest. You can't insure cash yourself, and the FDIC insurance doesn't cover it. First, there's no way to prove you had cash in your safe deposit box, so if it goes missing, no one can do anything about it. ![]() You might wonder why you shouldn't put cash in a safe deposit box, but the answer is simple. While safe deposit boxes are a good place to keep most items safe, there are certain things you shouldn't include, such as: What to Avoid Keeping in a Safe Deposit Box It's best to put items you won't need on short notice in your safe deposit box. ![]() Related Article | Financial Planning for New Parents: 12 Best Tips What to Keep in a Safe Deposit Box You can lose your items - If you don't renew your safe deposit box monthly, the bank could open the box, and the contents become a part of the unclaimed property.The bank safe deposit box cost varies by bank and credit union, but no safe deposit box is free. It's not free - You'll pay to rent a safe deposit box.Limited access - You can only access your valuables during the bank branches' hours and with the help of a bank employee. ![]() You can buy separate insurance coverage, but you must pay the premiums. FDIC insurance only covers deposits in checking and savings accounts, not safe deposit boxes. No insurance coverage - Banks don't insure the safe deposit box contents.You can keep items safe from others - If you have issues at home or worry about someone gaining access to your valuable items, you can lock them away, and no one else can get access without your permission.You won't lose important items - If you're worried about losing important documents or other items, such as family heirlooms, you can have peace of mind knowing they're safe in your safe deposit box at the bank.This reduces the risk of a fire damaging your personal items. Strong protection - Most banks have fireproof boxes to store items in their vault.Nothing is 100% foolproof, so always know the risks before placing items in a safe deposit box. Like any bank product or decision to store items, you should consider the pros and cons of safe deposit boxes before storing your important documents or valuables. The common names include:Īre There Pros and Cons of Safe Deposit Boxes? You might hear them called by their variations at different banks. Safe deposit boxes go by many names, but they all mean the same thing. ![]() The safe deposit box should give you peace of mind, knowing your most valuable items are locked safely. So whether you're concerned about the items being damaged or stolen or don't want to worry about the risk of natural disasters, you might keep them in a safe deposit box instead. Most people use the safety deposit box to store valuables they don't want at home. You don't have to worry about anyone else accessing your belongings because only the safe deposit box owner can access them. Most financial institutions charge an annual fee to rent the box and keep them locked up in a bank vault that you can only access with the help of a bank representative. Related Article | The Finance Dictionary: Learn the jargon your Finance friends speak! What Is a Safe Deposit Box?Ī safe deposit box is a metal box that holds your valuable items, such as family heirlooms or legal documents, at either a bank or credit union. Although some items don't belong at home because of the risk of theft or privacy, a bank provides the security you need.īefore renting, you should know everything about safe deposit boxes and how they work. Thanks to digital banking, it might have been months or even years since you've stepped foot in a bank, but there's one reason to keep your physical bank branch - safe deposit boxes.Ī safe deposit box is the only way to keep important valuables safe outside of using a fireproof home safe.
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