3 Things You Should Never Put in Your Safe-Deposit Box — and 6 Things You Should

Thursday, Dec 11 2014 12:00 AM

A safe-deposit box at a local bank or credit union may be the best place to store hard-to-replace documents, jewellery and other small valuables.  But it could be the worst place for certain other items.  Here’s a quick run-down of what to keep in — and keep out of — your safe-deposit box.

Leave these out

1. The only copy of your will.
No one but you, or a co-signer if you have one, can get into your safe-deposit box.  Normally that’s a good thing.  But if you die or become incapacitated, it can suddenly become a problem.

In some states, notes the American Bar Association, safe-deposit boxes are sealed when the owner dies.  Banks can also make the process of gaining access to a loved one’s box difficult out of concern for their liability.  Your heirs might need a court order to open the box.  This can result in delays in settling your estate and even cause some of your last wishes to be ignored.

Related: Do You Have a Will?

Two other documents to keep out: a living will (advanced health care directive), which expresses your wishes regarding medical treatment, and a durable power of attorney or health care proxy, which authorizes someone else to make financial or medical decisions on your behalf if you are incapacitated.  These will be of little value if locked away out of reach.

One alternative is to keep these documents in a secure place at home, such as a fireproof lock box or safe, and tell a trusted relative or friend where they are.  You can also keep the original of your will on file at your lawyer’s office.

2. Valuables you haven’t inventoried.
A safe-deposit box is a smart place to store small valuables, such as heirloom jewelry and rare coins.  But keep a list of what’s in there, ideally with photos and written appraisals for especially valuable items.

Unlike bank and credit union accounts, safe-deposit boxes are not federally insured, so you could be out of luck if your box is tampered with or destroyed in a fire or flood — rare but not unheard-of events.  Your homeowners' insurance policy may provide some coverage for the contents your safe-deposit box, but it’s likely to be modest, so ask your insurance agent about adding a personal article floater or endorsement to supplement it.

3. Cash.
Your money will be far safer in a federally insured bank or credit union account. It might even earn some interest.  If you want access to emergency cash 24/7, better to hide it somewhere at home.

Related: 4 Places to Stash Cash in Your Home — and 4 Places Not To

Put these in

1. An inventory of your household possessions.
In the event of a fire or other calamity at home, you probably won’t remember every single thing that was destroyed.  But you’ll need that information to file a claim on your homeowners policy or a casualty loss on your income tax return.  Store an inventory of your home’s contents in your safe-deposit box.  If you don’t have a safe-deposit box, you can keep the inventory in a locked drawer at work, at a relative’s home, or online.

2. Your passport.
Ever lost your passport?  Then you know what a hassle it is to replace one.  Keep it in the safe-deposit box unless you’re a frequent international traveler.

3. Deeds and titles.
The only time you’ll likely need the deed to your home is when you’re preparing to sell it.  It’s easy to misplace it in the meantime. Into the safe-deposit box it should go, along with the title to your car(s).

4. The originals of your birth certificate and marriage license.
You or your heirs may need them eventually, but probably not so often that you have to keep them at home.

5. Stock and bond certificates and U.S. Savings bonds.
These are increasingly being issued electronically, but if you have paper ones, store them in your safe-deposit box until you’re ready to sell or redeem them.  In some cases, lost or destroyed certificates can be replaced, but the process can be difficult and time-consuming. Before you lock them away, make photocopies or record their serial numbers and file at home.

6. Valuable jewellery you rarely wear.
Aunt Millie’s elaborate emerald brooch may not be your style, but it’s a beloved heirloom you’d like to keep in the family.  A safe-deposit box is a better place for it than a dresser drawer.  But remember that safe-deposit boxes aren’t federally insured, so the same rules about storing other valuables apply — in other words, you may need extra insurance. 

Greg Daugherty is a long-time personal-finance writer and a former senior editor of Money magazine.

Greg DaughertyMoneyDecember 11, 2014


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