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Why can't you keep cash in a safe deposit box?

by:Proway     2023-07-17

Why can't you keep cash in a safe deposit box?

Safe deposit boxes are ideal for storing precious and valuable items such as family heirlooms, important documents, and rare collections. They provide a high level of security and peace of mind. However, they are not suitable for storing cash. Many people believe that safe deposit boxes are the best place to keep their cash, but unfortunately, it's not always the best option. In this article, we will discuss why it is not advisable to keep cash in a safe deposit box.

The Risks of Keeping Cash in a Safe Deposit Box

Keeping cash in a safe deposit box might sound like a good idea, but it can pose certain risks and challenges. Here are some of the reasons why it's not advisable to keep cash in a safe deposit box:

1. No Insurance Coverage

One of the biggest reasons why keeping cash in a safe deposit box is not recommended is the lack of insurance coverage. Although banks are responsible for providing a safe deposit box, they don't provide any insurance coverage for the contents of a box. If the cash is lost or stolen, it's not covered by the bank or any insurance company, leaving you vulnerable to loss.

In comparison, depositing your money in a savings account will provide you with insurance coverage in case of theft, fire, or other damage. The FDIC (Federal Deposit Insurance Corporation) provides up to $250,000 insurance coverage for each depositor at each insured bank. Thus, it is best to place cash in a savings account rather than in a safe deposit box.

2. Unexpected Bank Closures

Another risk of keeping cash in a safe deposit box is the potential for unexpected bank closures. If your bank fails or goes out of business, accessing your cash in a safe deposit box can become a complicated process. The FDIC does offer insurance coverage for safe deposit boxes, but only for the items stored, not for cash. Therefore, you must recover the cash on your own, which can be a significant challenge if the bank is no longer operating.

3. Restrictions on Access

Safe deposit boxes have restricted access compared to other bank accounts. You need to visit the bank during operating hours and provide proper identification to access the box. If you need access to the cash quickly, you might not be able to get it when you need it. Even if the bank is open, the process of opening the box can be time-consuming due to the security protocols and measures in place. Therefore, keeping cash in a safe deposit box is not practical if you need access to the money in a hurry.

4. Physical Damage

Although safe deposit boxes are designed to protect stored items from theft and damage, they are not entirely immune to physical damage. Natural disasters or accidents such as floods, earthquakes, or fires can damage or destroy the contents of a safe deposit box. Even if the bank restores access to your box, your cash might not be recoverable, and you might experience a total loss.

5. Increased Risk of Money Laundering

One indirect risk of keeping cash in a safe deposit box is the increased risk of money laundering. Although most people who use safe deposit boxes to store cash have legitimate reasons, the anonymity provided by these boxes can also be exploited by criminals. The lack of transparency and accountability in safe deposit boxes can make it difficult to track illegal activities such as money laundering.


Keeping cash in a safe deposit box may seem like a sensible and secure option; however, you should weigh the risks and consider other options. A regular bank account or a savings account is preferable, as deposits are protected by the FDIC and can be accessed easily. Safe deposit boxes are still a valuable option for storing valuable items, but cash should not be included due to its risks and lack of insurance coverage.

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