No, really. What is the best place to store your money?
A study conducted by Piere, an AI-powered financial management app, found that the average American hides $544 in cash or valuables at home.
It’s okay to want to keep your money safe. But hoarding it in the wrong place can do more harm than good. Think about the 2009 story in which CNBC reported that a woman had not noticed that she was hiding $1 million in cash from an old mattress her mother had dumped.
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Even if your mattress (or equivalent items) is still in your home, there is a great risk to cash and its equivalent storage in your home. For one, insurance policies may not provide cash or crypto coverage. Even if you cover valuables, there may be policy restrictions.
Don’t forget the opportunity costs of cash. You’re not going to earn interest, and even worse, cash loses value due to inflation.
So, where is the best and worst place to store cash, valuables, or crypto?
Even if you’re sure your mattress isn’t the best place to store your cash, you probably won’t have a vase, freezer, or other secret compartment.
Your best bet is to store it in a bank or credit union. Most of these financial institutions have FDIC or NCUA insurance. If your bank or credit union gets mad, your money is safe up to the insurance amount.
A high-yield savings account offers a higher rate on your cash, as does a money market account. Please check if you have a minimum deposit amount and if there is a fee.
If you want to park your cash longer and want to guarantee some kind of return, a certificate of deposit (CD) might be a good option. Many banks and credit unions offer slightly higher interest rates depending on the period you agree to. Cash must be maintained for an agreed period. Otherwise you can pay the penalty.
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It may be safe to store coins and other valuables in your home, but make sure you document these items. If you do so, you will have documents to display to your insurance company if you need to file a claim. Consider storing these valuables safely fireproof.
Otherwise, you can pay for the safety deposit box at your local bank. Yes, it costs you, but it may be worth knowing that your valuables are probably safer than your home.