As personal banking goes digital, safe-deposit boxes may seem a relic from the analog age. Yet some people still want the security of storage away from home for valuables, important papers and sentimental keepsakes, financial advisers say.
A safe-deposit box is a locked storage bin, usually located in a vault or secure area, that banks and credit unions rent.
Federal regulators and industry groups said they don’t have statistics on the use or availability of safe-deposit boxes, but some banks and financial advisers said demand has been slack.
But Elizabeth Seymour, a spokeswoman for JPMorgan Chase, said that while she did not have historical data available, Chase currently has safe-deposit boxes in more than half of its branches and that they are still popular with customers.
David McGuinn, a safe-deposit box consultant in Houston, said there were still millions of boxes rented and plenty of branches offering them. He said he considered them “the safest place to store anything you consider valuable.”
So what should you keep in one?
The bank boxes are best for storing documents and valuables that you usually don’t need on short notice. The Federal Deposit Insurance Corp. said “good candidates” include originals of birth certificates, property deeds, car titles as well as paper U.S. Savings Bonds that haven’t been converted into electronic versions.
If you travel often or on short notice, keeping a passport in a safe-deposit box may be inconvenient, since you can only access the safe-deposit box during regular bank hours. A home safe may be a better choice.
Estate lawyers generally frown on keeping wills in safe-deposit boxes in case access to the box is restricted after the owner’s death. That may cause delays in retrieving the will.
“When a person dies, you may not be able to get to it,” said T. Randolph Harris, a lawyer specializing in estate and trust planning at McLaughlin & Stern in New York. He advises clients to keep the original will with their lawyer and to keep a copy at home.
Storing emergency cash in a safe-deposit box is also unwise, advisers said. Unlike money in a deposit account, cash in a safe-deposit box isn’t insured by the FDIC, and it may be vulnerable to theft. Earlier this year, the Federal Reserve Board took punitive action against a former bank employee who stole $30,000 from a customer’s safe-deposit box.
Banks aren’t immune to risks from natural disasters. So it’s best to seal documents or other items that may be damaged by flood in plastic bags or containers to help protect them from water damage, McGuinn said.
David J. O’Brien, a financial planner in Virginia, said he encouraged clients to take an inventory and to visit the box periodically to verify its contents.
He said a relative’s safe-deposit box was mistakenly drilled open and emptied by her bank, which had confused it with another box with a similar number whose owner had fallen delinquent on rental fees. The box’s contents — including a watch — were eventually recovered, he said. But the incident suggested that letting items languish indefinitely is a mistake. “You need to catalog what’s in it,” he said, “and then check on it.”
Ann Carrns writes for the New York Times.