Safe Deposit Box or Allocated and Segregated Storage
Comparing can clarify the question of whether a safe deposit box or allocated and segregated storage is more suitable for jewellery, precious metals or securities. The decisive factor is what is to be stored because both types of storage offer many advantages for their respective needs. This article lists the differences and helps inform private and business investors.
What are the main differences and which type of storage is recommended for which goods?
Investors who have put their available assets into stable and saleable goods such as gold, silver, precious stones or cryptocurrencies want to store their assets as securely and discreetly as possible. Depending on the type of physical goods being kept, there are different storage solutions such as off-bank safe deposit boxes or, alternatively, as allocated and segregated storage (also in bonded warehouses) in Switzerland. Swiss Gold Safe Ltd offers its customers both options. To give you an overview, we will draw a comparison between safe deposit boxes and allocated and segregated storage options.
The Advantages of Off-Bank Safe Deposit Boxes
Compared to storing valuables in your own safe or in a safe deposit box in a bank, off-bank safe deposit boxes in Switzerland or in the Principality of Liechtenstein offer many advantages. These are rental safes held in privately managed high-security vaults. They are suitable for storing goods with a high-value density, such as gold, precious gemstones or cash.
In Europe, Switzerland and Liechtenstein are easily accessible thanks to the optimal transport connections in either country. In addition, both countries are characterised by a high degree of political and economic stability. The unrestricted protection of property in these states is based on a long history. What’s more, it applies not only to the citizens of each country, but also to foreign clients. These are ideal conditions for German and other international interested parties looking to store valuables in non-EU countries.
Advantage 1: Different sizes of safe deposit box can be selected
Swiss Gold Safe offers customers safe deposit boxes and vaults in domestic storage facilities ranging in different sizes, from 7 to 90 litres. They are available from an annual rental fee of 511.60 Swiss Francs (CHF). The safe deposit boxes in categories 1-4 are subject to weight restrictions of 25 to 30 kg, while the larger safes (categories 5 and 6) can be used without any such limitations.
Advantage 2: Insurance is included
The annual rental fee comes with basic insurance that covers renters for a sum of up to 25,000 CHF. However, precious metals – in particular – can quickly exceed this value. Full coverage can be achieved by taking out additional insurance at a rate of 0.2 % of the stored value per annum. Cash can be insured annually according to its equivalent value at a rate of up to 0.3% per annum, something that reflects its greater sensitivity to fire and water.
Advantage 3: Access is only for customers or authorised persons
Only the customer himself – or persons authorised by him or her – will have access to the safe deposit box and thus to its stored contents. As a business principle, Swiss Gold Safe keeps no duplicate keys. This provides increased privacy protection, too, since only the tenant has knowledge of the contents and, where necessary, keeps independent storage lists.
Advantage 4: Authorisation of other people is possible
If tenants cannot attend appointments themselves, they have the option of authorising other people to act on their behalf, such as spouses / life partners, children or a notary. The extended access authorisation takes place via a correspondingly stored power of attorney. If necessary, a replacement key for the safe deposit box concerned can be deposited with an authorised person of trust.
Advantage 5: Access is possible at any time after registration
After registering, access to your safe deposit locker is possible at any time during normal office hours. This should ideally be arranged up to 24 hours in advance so that a discreet and exclusive visit to the vault can be guaranteed. 24/7 access outside office hours can also be arranged with a surcharge. In addition, well-trained and armed personnel are available as escorts.
Who are the safe deposit boxes at Swiss Gold Safe suitable for?
For customers relatively close to Switzerland who want to store their valuables securely, discreetly and independently of banks.
The Advantages of Allocated and Segregated Storage
In comparison to collective safe custody, in which the investor only has a percentage share of the stored goods, allocated and segregated storage preserves the unrestricted right of ownership to precisely defined goods. It is particularly suitable for storing silver or other white metals in large quantities. Special custody can take place without sales tax being applied in a duty-free warehouse bonded vault (ZFL) or an open bonded warehouse (OZL) in Switzerland. These are provided by Swiss Gold Safe for numerous customers. There are no weight restrictions either and sales tax is not incurred when buying or selling white precious metals in these storage facilities. For owners of gold, lodging their precious metal in a segregated fashion within a domestic warehouse is ideal. Even better, with this type of storage, there are neither quantity nor weight limitations. Business customers can also deposit cash in these sorts of facilities.
Segregated storage is particularly recommended for investors who live outside Switzerland or Europe and cannot be there in person. This could save a huge amount of outlay on travel, something that private and business customers appreciate in equal measure. Depending on your professional or life circumstances, there is often not enough time to travel to Switzerland. In addition, the Corona pandemic has shown that freedom of travel can also be restricted in democratic countries under certain extreme circumstances.
Advantage 1: Logistics partners take care of everything for you
Customers who have booked an allocated and segregated storage account with Swiss Gold Safe do not have to appear themselves to store or sell their stocks of precious metals. All the necessary movements of goods can be carried out by logistical partners. In this way, storage and retrieval can be conveniently commissioned from your study at home or from the office. We will also arrange for the transportation of the valuables to the storage facility or to a precious metal dealer on behalf of our clients – for example, when stocks are to be sold.
Advantage 2: Always keep an eye on the inventory in black and white
As soon as their goods have moved, the customer receives an updated stock list. In this way, he or she will always have an overview of their holdings and, therefore, the value of their physical assets. Precious metals are recorded using bar, seal or pallet numbers so that a clear allocation can be maintained at any time.
Advantage 3: Storage sizes to meet requirements
Customers who have opted for segregated storage can choose the size of their storage space according to their current needs and increase it at any time if they feel the future need to do so. There are no weight limits, either. The prices for a deposit are calculated according to the quantity and current precious metal price of gold, silver, platinum or palladium. However, the more precious metals that are stored, the lower the proportion the fee rate will be. The minimum storage fee is CHF 1,200 per annum.
Advantage 4: Full insurance is included
The annual fee for a deposit account includes full-risk insurance.
Advantage 5: Authorise other people
Other persons, such as spouses and civil partners, children, lawyers or notaries, can also be authorised to commission the movement of goods. Customers have the option to carry out an inventory at any time upon registration or to commission an audit company to do so on their behalf.
For whom is allocated and segregated storage with Swiss Gold Safe suited?
For investors who do not want to store their goods themselves but who wish to expand or sell their holdings without being present.
A flexible combination of safe deposit boxes and individual custody
Clients who wish to store their assets with Swiss Gold Safe do not necessarily have to make an absolute choice between these two types of storage. For a number of reasons, it can make logical sense to opt for a combination of safe deposit boxes and segregated storage (often referred to as individual custody). This can be the case, for example, when clients from abroad wish to store larger stocks of precious metals. Here, the majority of goods might be stored privately in a safe deposit box, while the rest of the holding remains in individual storage – where the client can easily sell certain amounts as and when required, while continuing to enjoy the further advantage of not having to appear in person to complete a transaction.
A division of inventory could also be of interest to people who have a large holding of silver in addition to other valuables. In such circumstances it would be prudent to deposit items such as gold, jewellery and documents in a safe deposit box while storing your white precious metal in individual custody – which is also possible VAT-free, and where no weight limits apply. This particular combination of storage options represents a flexible and convenient solution that efficiently exploits the advantages of both systems.
Furthermore, such a procedure could potentially turn out to be even more cost-effective. The physical separation of the two deposits also has further advantages, because experts emphasise the importance of storing larger quantities separately wherever possible in order to minimise the overall risk. Diversification is also an important consideration when it comes to storing quantities of high-value assets. This arrangement naturally requires two separate contracts, one to cover each of the different kinds of stored goods.
For existing safe deposit clients, splitting any amounts kept in storage can initially involve a little extra work. This is simply because safe-deposit tenants, or their authorized representatives, must be present for any storage, removal or rearranging of the contents of any safe deposit box. However, this does mean clients can then enjoy the greater flexibility offered by segregated custody in the future.
Conclusion: Weighing Up the Pros and Cons According to Your Needs
Whether you opt for a safe deposit box or allocated and segregated storage, both ways of storing items can complement each other. Each offers advantages and disadvantages that have to be weighed up depending on individual requirements and the characteristics of the items being stored. In addition to cost, other criteria – such as accessibility, travel time, flexibility as well as personal circumstances – should be the decisive factors. Irrespective of these considerations, both storage solutions guarantee unrestricted control of holdings at all times.
|Pros and Cons of a Safe Deposit Box||Pros and Cons of Allocated and Segregated Storage|
+ Available in different sizes with or without weight limitations
+ Annual rent includes basic insurance. Full insurance is also possible, subject to the value of the stored goods.
+ Only the customer or authorised persons have access to maintain privacy protection.
+ Spouses, life partners or other trusted persons can be authorised by power of attorney.
+ Access is possible at any time 24/7 even including an escort.
+ No in-person appearance necessary. All movements of goods can be conducted through logistics partners.
+ Thanks to up-to-date inventories, you always receive precise stock information.
+ Storage space can be arranged without weight limits. Fees are based on precious metal prices.
+ A full-risk insurance cover is included.
+ Authorisation of other persons is possible: a spouse, a civil partner, a notary or an auditing firm.
– Weight restrictions are in place for smaller safe deposit boxes.
– Duty-free storage is not possible.
– No silver purchases are possible without sales tax.
– Storing jewellery is not possible.
Therefore, this makes them most suited to storing gold, precious stones or cash for customers who are in relative proximity to Switzerland.
Therefore, this makes it suitable for the tax-free storage of silver and gold in large quantities for customers outside Switzerland or Europe with limited time to travel.
Summary of a comparison between safe deposit box storage and individual custody at Swiss Gold Safe
FAQs: Your questions about combined storage arrangements
Because our safe deposit boxes in categories 1-3 have a weight limit of 25 kg, you would have to choose either several small lockers, or one large category 4 locker. We would therefore recommend segregated storage (either domestic or duty-free) as the most economic solution.
No, this won’t have any direct bearing on the basic tariff. Neither our safe deposit box prices nor the minimum storage fee for segregated custody are affected by any combination of the two storage options.
No, the fees for segregated safekeeping are calculated exclusively on the basis of the goods stored there.
Unfortunately, this is not possible. Any storage, removal, and/or transfer of the contents of a safe deposit box still requires the client to be present. However, Swiss Gold Safe can help to organise the transport of valuables at the client’s request.
No, separate contracts are issued for each option. This is because a safe deposit box contract is a form of rental agreement, whereas individual custody arrangements require a storage contract.