A DepositAccounts.com reader brought to my attention a break-in of a private vault service in Las Vegas that happened last month. He had a box at that place, but his box wasn't affected. I had not been aware of these types of services. They are a lot like safe deposit boxes from banks. However, they offer more privacy. As you might guess, these types of private safe-deposit box firms are often accused of being used by criminals who want to hide their ill-gotten gains. The DA reader mentioned that this service appealed to him since it allowed 24/7 access without requiring an ID. For customer verification, the service uses bio metric scan of a customer's iris. The place did have a lot of security, but it wasn't enough to prevent the break-in.
My feeling is that a bank safe deposit box provides more security against theft than these private vault services. There have been cases of robbers breaking in to bank safe deposit boxes, but these are very rare. It's important to note that FDIC insurance only covers deposit accounts. It provides no coverage of safe deposit box contents. Also, you shouldn't expect the bank to reimburse you for theft of or damage to the contents of your safe deposit box. This was one of 5 safe deposit box tips provided by this FDIC consumer news article.
A more common issue with safe deposit boxes is the ease of access to your box. Your heirs could have trouble accessing the box after your death. DA reader pearlbrown provided this useful tip about what not to put into a safe deposit box:
I would never put originals of documents such as wills, trusts, or power of attorney documents in a safe deposit box unless the person who might need access to them also has access to the box. Copies, yes, but originals never. A safety deposit box could be sealed for weeks after a death and the person who is to act as your executor could be caught in a drawn-out and expensive legal catch-22 (they need the original document to demonstrate that they are the executor and have access to the box but the document is inside the box).
Another potential issue with safe deposit boxes is the possibility that the contents in the box will be escheated (turned over to the government) if a box is dormant. This can occur even if all rent payments have been made. This article describes how this happened to a California woman who had a box at her local Bank of America branch.
With the issues and costs of safe deposit boxes, home safes may be more appealing. But there are still risks of theft, fire and flood.
Poll Question: Where do you keep your valuables?
So that leads me to this poll question: Where do you keep your valuables and important documents? Do you only use a safe deposit box? only a home safe? Or do you use both? If you use a private vault service or if you don't use anything, choose "other".