Thursday, July 15, 2010

Safe Deposit Boxes

At some point in your life, you are likely to possess something valuable that absolutely cannot be lost or damaged. It may be important paperwork, a family heirloom, expensive jewelry, etc. Whatever the item, you will need a secure place to store it where it willb e safe from robbery, fire, flood, and other potential destruction. One such location is a safe deposit box, which you can rent from your bank.

Specific bank policies on safe deposit boxes vary, but prices and fees are fairly common. A small safe deposit box will likely cost you $15 to $20 per year to rent. Medium-sized boxes start around $40 per year, and larger boxes can cost up to $500 annually. Additionally, you may be charged a key deposit fee. At many banks, these expenses can be automatically deducted from your accounts, so keeping your box is a relatively hands-off process.

Once you’ve got a safe deposit box, you need to decide what goes inside. For starters, you should keep paperwork that cannot be easily recovered. This includes original birth certificates, titles, mortgages, wills, stocks, and bonds. You should also use the box for any valuables that are irreplaceable, such as old / expensive jewelry, important collections (like stamps), or family artifacts and photos.

Of course, there are things that should not go in your safe deposit box. Since you will not always have ready access to the box, you want to avoid leaving passports, social security cards, medical information, etc. inside. Remember, banks close and you will not be able to gain entry to your safe deposit box after hours. For this same reason, you should keep copies of any important papers you put in the box.

It is a good idea to make a list and take pictures of items left in your safe deposit box should there ever be a problem. Obviously, safe deposit boxes are intended to be completely secure. However, it is always best to plan for the worst. Despite being resistant to fire, flood, etc., emergencies do happen. In extremely rare instances, it is even possible that someone could illegally gain entry to your box. Another, more common, scenario is someone giving their spouse access, and then going through a messy split.

Items in your safe deposit box are not FDIC insured like accounts. Unless a bank has done something negligent, they are not responsible for losses you suffer in the event of an emergency. However, most homeowner’s and renter’s insurance will cover safe deposit box items up to a certain value. Alternatively, you can purchase additional coverage just for these important items.

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