Financial Papers – Which to Keep and which to Ditch?

We are living in the digital age, but we are still surrounded by paper every day – and lots of it. Bank statements, bills, correspondence, tax returns, warrantees, agreements, you name it are all part of the “paper trail” we leave behind. The amount of paper we keep can reach enormous proportions, but do we really need to keep everything that continues to pile up every day? A proper records management solution can spare you time and protect sensitive information.

We all have papers stashed away somewhere. Some people are well-organised and have everything categorised while others keep their financial documents stored in boxes or wherever they can find a gap. Many of us hang on to these documents for years, and we dread the day that we will have to sort through them and decide which ones to keep and which ones to ditch. While some are important to store in a safe, fire proof and theft proof place, not all documents need to be saved.

Which to keep

The original versions of the following documents need to be kept safe, whether in a safety deposit box or a safe place in your home or office. It is important to also scan these documents and keep them backed up on a hard-drive or the cloud.

  • Any official, government issued documents such as birth certificates, marriage certificates, divorce certificates, death certificates, passports and identity documents.
  • Insurance policies
  • Title deeds, car registration documents
  • Tax returns. These need to be kept for at least seven years. Receipts related to your tax returns such as for donations should also be kept.
  • Warrantee documents. Keep these for as long as the item is under warrantee.

Which to scan

The following are documents that are important to keep but of which the original version has no added importance. Utilise a scanning service or document archive storage for these types of records.

  • Receipts for major purchases such as laptops, iPads, photographic equipment, TV sets and jewellery should be kept in case you ever need to submit an insurance claim.
  • Receipts for home improvements should be kept for tax purposes in the event you are selling your property.
  • Brokerage statements need to be kept for tax purposes to prove capital gains and cost basis.
  • Salary slips.
  • Medical bills should be kept to support tax deductions or in case you have a dispute.

What to ditch

Most of the following documents are available electronically. In order to reduce fraud, the best option would be to sign up for electronic statements for easy access online.

  • Bank and credit card statements
  • Bills

Once you have gone through your documents, create a system for future documents you’ll receive so that you don’t have to do this again  . It is also good to know which documents are where so that you can easily access them when needed.

Some quick tips

Don’t forget to shred the important documents you no longer need

In order to prevent identity theft, shred each and every piece of paper that has your personal information on it. The safest way to dispose of these documents is through document shredding. There are companies who can do this for you safely and securely.

Keep a ‘copy’ of login details

All of us store incredible amounts of information online, so it is important to keep a record of your login details and passwords to financial and other important accounts. These can be kept in a safety deposit box.