Safety deposit boxes: What goes in, what stays out | Personal Finance

At some point in our lives, we will sign a document or deed that needs to be preserved.  Having a home file for just such a purpose is a great idea, but an even better idea is a safety deposit box at your local bank. These boxes are inexpensive to rent, and they will provide protection that your home cannot. 

As safe as a bank box may be, there are some considerations that should be made before you choose what you will place in them. For example, how often will you need to access the deposited document? How safe is the bank? Is the document so important that it needs safe keeping?

Safety deposit boxes are easy to obtain and are accessible during bank hours. It is important to remember that if something could be needed after hours, it will not be available. During the coronavirus pandemic, many banks were closed for long periods of time and those safety deposit documents were out of reach. Although banks are built tough, it is also possible that a tornado or hurricane could impact them just as a catastrophe could impact your house. 

Another consideration is that your box contents are not FDIC insured like your checking account is. If your deposited items are damaged or destroyed there is no law that requires the bank to make restitution for your loss. This is not to say that a bank is unsafe, it just means that you need to keep a realistic perspective when you store your valuables. 

Important documents should be kept safe, and the safety deposit box is ideal for this purpose. Some items that should be considered for this type of safe keeping are items that you cannot afford to lose. 

Some suggestions are:

• Birth certificates, marriage licenses, your last will and testament, and social security cards
• Stocks, bonds, and bouillon
• Mortgage documents, contracts, deeds, and titles
• An inventory of personal possessions in case of robbery, fire, or flood
• Family heirlooms that are small enough to fit
• Historical pictures or negatives that cannot be reproduced – such as your great grandparents’ wedding photo or photos of your town from a bygone era.

There are other items that may be best stored in a bank vault, but there are also many things that should never be put in a safety deposit box. 

These include:

• Guns, firearms, and explosives that are illegal to store in a bank vault
• Cash — you’re missing out on growth potential while purchasing power is being lost to inflation.
• Your living will
• Your passport if it is used periodically
• Any item or document you may need in an emergency

As you consider what should or should not go into your safety deposit box, consider the difficulty you could experience if that item were needed, and you could not access it. If it would be troublesome if you could not get to your box, then don’t store the item there.

Safety deposit boxes are a good choice for many items and are never considered “abandoned” unless you cease paying the box rental, so you don’t need to visit your box with any frequency.  Even then, the bank will do its best to contact you or your family before determining that the box is truly unclaimed, but it is best to keep up your rental payments. 

Mary Fox Luquette, MBA, CLU, ChFC is a finance instructor in the BI Moody III College of Business at the University of Louisiana at Lafayette.