Protect Your Assets from Burglars and Fire

The threat of a home burglary or fire is real.

Home safes and safe-deposit boxes should be a part of your financial makeover. It’s not enough to dream big, save, invest, and have insurance. You need to protect your valuables too. Not all safes provide the same quality of protection. This section demystifies home safes and provides concrete advice on which documents you should keep at home and which documents you should keep in a bank’s safe-deposit box.

I have personally experienced loss from both fire and burglary. Both occurred when I was young, but I remember it like it was yesterday. The total financial loss to my family (after insurance proceeds) was minimal, but the emotional loss was great. A check from your insurance company can’t replace sentimental items.

The two most common and practical ways to protect your documents are a safe-deposit box and a home safe. Professional document and property storage companies will keep your documents safe, but for the majority of people, a safe-deposit box and a home safe are sufficient.

Home Safes

A residential fire occurs every 79 seconds and over 4 million homes are burglarized each year in the United States. The threat is real – six billion in assets are lost each year to fire. Your asset protection plan needs to guard against the threat of aggressive lawyers as well as physical threats such as fire and theft. Protecting against physical danger is simple and the losses are avoidable with an appropriate home safe.

This section will address the various types of home safes, which type you need for your situation, what the ratings mean and the minimum rating required, and what should and shouldn’t be stored in a home safe.

There are fire safes and there are burglar safes. There are also fire/burglar safes. A fire safe offers little protection against burglary. Conversely, a burglar safe provides little protection from a fire. To fully protect the contents of a safe, you must make sure the safe is rated for superior protection against both fire and burglars.

The safe’s rating is very important. It must be “UL” rated. The UL is Underwriters Laboratories, a not-for-profit product safety testing and certification organization established in 1894. They have the “undisputed reputation as the leader in U.S. product safety and certification.” Many products attempt to suggest UL certification without actually earning the UL stamp of approval. Be aware of claims like “built to UL standards” or “materials comply with UL standards.” This doesn’t mean the safe is UL approved. To insure your safe offers the maximum protection available buy only UL rated safes.

Underwriters Laboratories provides ratings for the following two characteristics:

1) Fire Resistance – This rating includes two numbers such as UL 350–1.

The first number is a measure of the maximum temperature the inside of the safe will reach. For example, a rating of 350 means that the inside of the safe will not reach a temperature over 350 degrees.

The second number represents the amount of time the safe will not exceed the temperature rating. For example, a rating of 1 means the safe is protected at the stated temperature for at least one hour.

A safe rated UL 150-2 means the inside of the safe will not exceed 150 degrees for at least two hours.

2) Burglary Resistance – There is only one number for this measurement.

Underwriters Laboratories uses the initials “TL” to denote burglary and tamper resistance. The TL will be followed by a number. The number represents the minutes the safe can withstand someone trying to break into it using a variety of tools such as a hammer, chisel, high-speed drill, saw, or diamond grinding wheel.

For example, a safe rated TL 30 means the safe is protected from a variety of tools for at least 30 minutes.

An adequate home safe that protects against fires and theft will have a UL 350-1 TL-30 rating or better.

What Should Be Stored in a Home Safe

While a top UL rated safe installed properly in your home is not a guarantee against fire or burglary, it is a very important step forward. Having taken that step, you can feel reasonably confident in storing the following approved items in your home safe.

Include

• Cash
• Wills
• Trust Documents
• Powers of Attorney
• Real Estate Deeds
• Jewelry
• Stock and Bond Certificates
• Video Inventory (copy)
• Firearms
• Precious Metals
• Asset Inventory (copy)
• Important Documents (tax returns, insurance policies, birth/marriage certificates)

Safe Deposit Boxes

Having a good home safe shouldn’t stop you from having a safe-deposit box at your bank. There are many advantages to having both. Some documents should be stored at home and others are better kept within a bank’s vault.

Safe-deposit boxes come in a variety of sizes and are an inexpensive way to protect certain documents and property. Each safe deposit box has two separate locks. You receive a key to open one lock and the bank keeps a key for the other lock. Both keys are required to open the box. You specify who has authorization to access your box, and then it is the bank’s responsibility to monitor and control access to only those who are approved.

Advantages

• Protection – Bank safes provide superior fire and theft protection.
• Monitoring – Most banks are under 24-hour surveillance.
• Control – The bank controls who can access the safe.
• Some Privacy – The bank doesn’t know the contents of your box.

Disadvantages

• Inaccessible – You can only access the contents in your box during regular bank business hours. You will be unable to reach the contents in your box after hours or on bank holidays. Do not keep anything in your safe-deposit box that you may need immediately.
• Sealed at Death – Most banks don’t seal boxes at death anymore but they can still make it very difficult for you to get access to a box upon death of the owner. Inflexible bank rules can make a time of grief even more difficult.
• Inconvenient – A home safe can be accessed in seconds. A safe-deposit box requires planning and a special trip. Store documents and jewelry that you use often in your home safe.
• No Insurance – Most banks do not hold insurance for the contents of safe-deposit boxes.
• No Creditor Protection – A safe-deposit box provides no asset protection in the case of a lawsuit judgment or in needing to pay back-taxes. In those cases, other individuals will have access to the contents of your box.

The following documents can be stored in a safe-deposit box:

• Cash
• Wills (copy)
• Trust Documents (copy)
• Powers of Attorney (copy)
• Real Estate Deeds (copy)
• Jewelry
• Stock and Bond Certificates
• Video Inventory (copy)
• Precious Metals
• Asset Inventory (copy)
• Important Documents (tax returns, insurance policies, birth/marriage certificates)

You’ve come this far in your financial transformation, so don’t stop now. Invest in a home-safe and a safe-deposit box.

The proceeding blog post is an excerpt from The Six-Day Financial Makeover: Transform Your Financial Life in Less Than a Week!, available now on Amazon.