6 Things to Know About Safe Deposit Boxes 6 Things to Know About Safe Deposit Boxes

If you're looking to securely store valuables, you may be considering options including purchasing a lock box or home safe to keep in your house. 

Safe deposit boxes (sometimes referred to as safety deposit boxes) offer an added level of security for a range of personal belongings from important documents to valuable family heirlooms. Below, we'll dive into what a safe deposit box is, how they work, what you can store in a safe deposit box, some pros and cons of using a safe deposit box, how to rent a safe deposit box, and more!

1. What is a Safe Deposit Box?

A safe deposit box is a container, usually a secured metal box, held in the safe, vault, or other secure area of a Federal Deposit Insurance Corporation, or FDIC, insured financial institution. Usually, banks will offer safe deposit boxes in a variety of dimensions that can be chosen based on the size of the valuables a client is looking to store. Clients will then pay their bank or credit union an annual or monthly rental fee for use of the safe deposit box. 

2. How Does a Safe Deposit Box Work?

Again, safe deposit boxes will vary by financial institution, but there are a few common set ups banks use for safe deposit box rentals. Many banks will give you a key to use to access your safe deposit box. In this instance, your bank may also have a key to your safe deposit box, often called a guard key, which is used in conjunction with your key to access the box. Some financial institutions may also use a biometric system, sometimes referred to as a keyless system, where your fingerprint or handprint is scanned to gain access to your safe deposit box. Most financial institutions will also require you to present personal identification before you access your safe deposit box. These layers of security are designed to offer maximum protection and ensure that only designated individuals are allowed to access the safe deposit box. 

So who exactly can access a safe deposit box? That is totally up to the person renting the box. You can decide to rent a safe deposit box and only give yourself access to open it, or you can give others access to open the box as well. Depending on the financial institution, all parties on a safe deposit box rental lease may or may not need to be present to access the box. This is an important factor to consider based on your personal needs and circumstances when deciding which financial institution to open a safe deposit box at. For instance, if you want to add your sibling that lives across the country to your lease, and you opt to open your safe deposit box at a bank that requires all parties on the lease to be present in order to open the box, it may be an inconvenience to coordinate a situation in which the box can actually be opened. 

3. What Can Be Kept in a Safe Deposit Box?

Safe deposit boxes are used to store a variety of items that require a level of security not available at home. This includes original copies (but not all copies) of documents including birth certificates, property deeds, car titles, marriage licenses, copies of power of attorney papers, savings bonds, contracts, paper stocks, adoption papers, and more. They are also a great place to keep important family keepsakes like photos, collectable items, hard drives or flash drives holding important information, an inventory of your home's contents in the event you need to file an insurance claim, and other important items. 

4. What Shouldn't Be Kept in a Safe Deposit Box?

Keep in mind that you won't be able to access a bank safe deposit box when your financial institution isn't open, so any items that you may need to use at the drop of a hat shouldn't be kept in one. Passports and only copies of legal documents like living wills, medical directives, and powers of attorney are examples of documents that it might not make sense to kept in a safe deposit box. You may opt to keep items like these in a home safe or lock box so that they remain secure and you have more immediate access to them when needed. 

It's also inadvisable to store cash in a bank's safe deposit box as it won't earn interest. You're much better off depositing cash in an interest-bearing savings account or certificate of deposit account. It's important to note that unlike deposit accounts, safe deposit boxes do not have FDIC insurance. According to the FDIC, "a safe deposit box is not a deposit account. It is storage space provided by the bank, so the contents, including cash, checks or other valuables, are not insured by FDIC deposit insurance if damaged or stolen." Financial institutions generally won't insure the contents of safe deposit boxes either because they don't have a way to verify what is in a box. However, speak to your homeowners or renters insurance provider to see if the contents of a safe deposit box are covered under those policies.

5. Advantages and Disadvantages of Safety Deposit Boxes

As mentioned above, one of the main advantages of using a safe deposit box to store valuables is the added security for important documents and personal belongings. Unlike a home safe or lock box, safe deposit boxes will be protected by a bank's full security apparatus including camera, guards, and alarm systems. They are also fire and waterproof, meaning in the event of a natural disaster your belongings have additional protection against damage and loss. 

Some of the disadvantages of using a safe deposit box include the lack of insurance on the stored contents and accessibility being limited to the financial institution's hours of operation. 

6. How Much Does a Safe Deposit Box Cost?

Leader Bank offers safe deposit boxes in a variety of size at our Belmont and Arlington Heights branches. You can view the pricing options below:

To learn more about Leader Bank's safe deposit box options or to rent a box, please visit our Belmont or Arlington Heights branches or reach out to our team at 781-641-8686.