Safe deposit boxes are a great way to securely store valuable items and documents – protected against theft, loss and damage.
You’ll commonly find them at brick-and-mortar bank branches, and they are relatively inexpensive to rent. A small box could cost you between $15 and $100 per year, depending on where you live, according to MarketWatch Guides research. Larger boxes could cost as much as $150 to $400 per year.
The cost of a safe deposit box typically varies by individual bank branch, so you’ll need to call to shop around.
Key Takeaways
- Safe deposit boxes provide secure storage for valuables and important documents.
- Maintain an updated, detailed inventory of what’s in your safe deposit box to ensure you’re using it effectively.
- Alternative options include home safes, digital safes or dedicated safe storage facilities.
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How Does a Safe Deposit Box Work?
A safe deposit box is a secure container usually provided by banks or other financial institutions. In many cases, the box is kept in a secure room inside the bank. You’ll have to prove to the bank that you’re authorized before you can access your box, and you may need an appointment.
The primary purpose of a safe deposit box is to securely store important documents, jewelry and other valuables that you may not want to keep at home due to concerns about theft, loss or damage.
The following are some key features of safe deposit boxes:
- Increased levels of security: Safe deposit boxes are often in a vault or secure area within the bank.
- Varying sizes: Safe deposit boxes come in various sizes to accommodate different storage needs.
- Restricted access: Only authorized individuals, such as the box owner and bank staff, can access a safe deposit box.
- Need a key or access code: Access to safe deposit boxes typically requires the use of a key or electronic access code.
- Confidentiality: Banks are legally obligated to maintain the privacy and confidentiality of safe deposit box contents.
How To Rent a Safe Deposit Box
You can rent a safe deposit box at many federally insured banks and credit unions. When considering where to rent a safe deposit box, it’s important to explore various factors to ensure you select the right provider for your needs.
- Hours of access: Some banks may offer extended hours or even 24/7 access to their safe deposit boxes, while others may have more limited access.
- Annual rental fees: Fees can vary depending on the size of the box and the location of the institution. Prices can range anywhere from $15 to over $300.
- Storage box restrictions: There are restrictions on what you can store in the box.
- Insurance coverage: Most banks don’t offer insurance for safety deposit boxes so you may need to get your own insurance.
- Extra fees: There may be fees for late payments or for accessing the box outside of designated hours.
By thoroughly researching and comparing options, you can select a safe deposit box provider that meets your needs while providing peace of mind knowing your valuables are secure.
What To Store in a Safe Deposit Box
When it comes to deciding what to store in a safe deposit box, it’s crucial to prioritize items that are irreplaceable or difficult to duplicate. Here’s a list of important items that you may want to store in a safe deposit box:
- Precious valuables: Examples include jewelry, watches, antiques, rare coins, stamps or collectibles such as high-value artwork or photographs.
- Important documents: Examples include original copies of birth certificates, citizenship certificates, social security cards, property deeds, living wills, trusts, and power of attorney documents.
- Sentimental keepsakes: Examples include family photos and letters, personal journals and diaries and valuable childhood mementos or heirlooms.
- Backup data: Examples include external hard drives containing critical data backups and flash drives with irreplaceable digital files.
Remember to select items you wouldn’t want to lose or risk damage to, and ensure you store digital copies of your documents elsewhere for easy access if needed.
What Not To Store in a Safe Deposit Box
While safe deposit boxes offer excellent security, you are better off keeping some items elsewhere. Here’s what to avoid storing in your secure box:
- Cash or currency: While a safe deposit box is secure, it’s not an ideal place to store cash as the FDIC does not insure it against theft or damage.
- Hazardous materials or substances: You should never store items such as chemicals, explosives or flammable materials in a safe deposit box.
- Illegal items or substances: Storing illegal materials can lead to legal consequences and jeopardize the security of the box holder and the institution.
Storing inappropriate items in a safe deposit box can cause access and replacement complications. Because safe deposit boxes are not insured by the financial institution, carefully consider the suitability of your items and consider other storage options, if needed, for certain items.
How To Utilize a Safe Deposit Box Effectively
Utilizing a safe deposit box effectively involves proper organization, regular maintenance and keeping track of stored items. Here are some tips and guidelines to maximize its efficiency:
Organize and Categorize Items
Organize the items you plan to store in your safe deposit box. Use labeled folders or containers to group similar items together, making it easier to locate specific documents or valuables when needed.
Regularly Check and Update
Schedule monthly or every-other-month check-ups to review the contents of your safe deposit box and update as necessary. This practice also allows you to remove any items that you no longer need or replace outdated documents with updated versions.
Keep an Inventory
Maintain a regularly updated, detailed list of all items in your safe deposit box, including descriptions and photographs if possible. This will serve as a valuable reference in case of loss, theft or damage.
Pros and Cons of Safe Deposit Boxes
Safe deposit boxes offer several advantages and disadvantages, similar to other banking options:
Pros
Enhanced security: Stored items are often housed in bank vaults under advanced security measures such as surveillance, alarms and fireproof construction, offering far greater protection than most home safes or hidden stashes.
Privacy and confidentiality: Only authorized individuals can access the box. Banks maintain strict confidentiality, further protecting your valuables.
Protection from natural disasters: Bank vaults are built to withstand natural disasters such as floods, fires and earthquakes.
Protection from theft: Your valuables are less susceptible to theft within a bank vault compared to being kept at home, especially if you live in an area with higher crime rates.
Cons
Limited accessibility hours: Access is typically limited to bank operating hours, which can be inconvenient if you need your items outside of these hours.
Annual rental costs: Safe deposit boxes incur annual rental fees, ranging from $15 to $300 or more depending on size and location.
Limited insurance coverage: Banks do not automatically insure the contents of safe deposit boxes, so you may need additional insurance.
Not suitable for everyday essentials: Items needed readily, such as passports or medication, are better kept elsewhere for easy access.
Safe Deposit Box Alternatives
When considering alternatives to safe deposit boxes for safeguarding valuables, you may want to consider these options:
Home Safes
Installing a home safe offers convenient access to valuables while providing an increased level of security within your residence. Home safes come in various sizes and designs, including fireproof and waterproof options, allowing you to customize your security needs. It’s essential to ensure proper installation and anchoring to prevent theft and unauthorized access.
Digital Safes and Vaults
Digital safes and vaults utilize electronic locking mechanisms and advanced security features to protect valuables. These safes offer secure storage with the added convenience of easy access through pin codes or biometric authentication.
Safe Storage Facilities
Safe storage facilities offer secure storage options for valuables, similar to safe deposit boxes but without the limitations of bank operating hours. These facilities provide various storage options, including lockers, vaults and climate-controlled units. Safe storage facilities may also offer additional services such as insurance coverage and 24/7 access.
The Bottom Line: Securing Your Valuables
Safe deposit boxes offer enhanced security, privacy and protection. By renting a safe deposit box from a reputable institution, you can enjoy peace of mind knowing that your valuables are safe from potential risks such as theft, damage and natural disaster.
Take the time to research and compare options, considering factors such as accessibility hours, rental fees and insurance coverage. Additionally, carefully assess what items are suitable for storage in a safe deposit box and explore alternative options for those that may not be ideal.
Today’s Top Banking Offers
You could get over 10 times** the average national savings account rate with our featured partners below.
*Annual Percentage Yield
**Accurate as of August 2024, assuming FDIC average savings rate of 0.46% and $2,500 deposit.
FAQ: How to Save Money Fast
Some of the fastest ways to save money are by spending less, earning more and depositing money in an interest-earning account — like a high-yield savings, CD or money market account. Keep your savings separate from your checking account, or any account you can access with a debit card, so you’re not tempted to spend it.
If you don’t have much money and want to build savings, try starting small. The goal is consistency. Build the habit of saving so that as you earn more, your savings can grow. Keep an eye on your expenses, even if you’re not earning a lot. Keeping your expenses low will also work to your advantage as your income, and ultimately your savings, grow.
To save for a big purchase, start by identifying the savings goal. Then, calculate how much you can save each month until you reach your goal. For example, if you want to save $1,800 and you can put away $150 per month, expect to hit your savings goal in one year.
How much you should save each month depends on your savings goals and personal finances. Some may start with as little as $10 per month, while others stash away hundreds. What’s more important than a specific amount is to contribute consistently, making saving a part of your budget. No matter where you start, keep your money in a separate account that can earn interest.
*Data accurate at time of publication
Editor’s Note: Before making significant financial decisions, consider reviewing your options with someoneyou trust, such as a financial adviser, credit counselor or financial professional, since every person’s situation and needs are different.
If you have feedback or questions about this article, please email the MarketWatch Guides team at [email protected].
