Safe Deposit Boxes: What They Are & How to Use Them

What is a safe deposit box?

A safe deposit box is a secure storage space kept at a bank in an area with limited access, such as an area leading up to a vault. A safe deposit box can be thought of as a mini vault that can be rented out by average people in order to store their valuables. Safe deposit boxes can be used to store pretty much anything: cash, gemstones, jewelry, important documents, and art, the only limitation is the size of the box. Average safe deposit boxes are relatively small, so storing something like paintings would take a more expensive, larger box.

How to use a safe deposit box

A safe deposit box is best used to store items that one feels are not safe in their own keeping. Since banks are int he business of housing large sums of cash, they generally have high security. When using a safe deposit box, it is best to use as large an secure a bank as possible--this might mean using a bank in a large city somewhat displaced from the city a person lives in. Anyone with a safety deposit box should consider keeping copies of important documents in them for safe keeping: contracts, birth certificates, wills, and marriage licenses are examples of documents that can be copied and backed up with a safe deposit box. They are also useful for storing important digital data, such as copies of family pictures. Basically anything that would be very difficult to replace in the event of a house fire or theft is a good candidate for a safe deposit box.

Advantages and dangers of using a safe deposit box

Safe deposit boxes are useful for protecting important items, but even banks are not 100% immune to potential losses. Things like fires, floods, or bank robberies can potentially result in the loss of items kept in a safe deposit box. Given this fact, and the fact that it costs money to rent a deposit box, many people opt to simply buy insurance policies on their valuables rather than keep them in a safe deposit box. An insurance policy can protect an item against loss from any source--the one problem with using insurance policies instead of a safe box is for irreplaceable items, such as family heirlooms or original works of art.