Paper Headache

It’s tax time…I feel a headache coming on do you?  If filing taxes isn’t hard enough what should we do with all the financial records and utility bills collected over the year?  It can be easier than you think.  First of all find yourself a box and a felt marker, let’s begin. (Check the sidebar for important questions to ask yourself before you start.)

Tax Records: Put everything you used to complete your taxes; w-2’s, charity receipts, government records, etc. including copies of  the completed tax forms you filed into one bundle.  If it fits in a large manila envelope, use that and mark the front of the envelope Taxes 2008.  Keep that in the file drawer or another accessible place until next year.  If you have previous years’ taxes bundled put them in the box.  (Tax records should be kept for 7 years.)

Retirement Contributions or Statements:  Any non-deductible contribution receipts should be kept permanently. ( Do not store permanent records in the box.)  It is only necessary to keep the annual account statement. Be sure it has been reconciled with the previous quarterly statements.  If you have a number of annual statements, keep the most current one in your file drawer and put the others in the box. 

Bank records:  Since most of us do not receive check copies anymore this can be a touchy subject.  If you have room I suggest keeping your bank statements in the box.  You may also put your old check registers in the box.  I only suggest this because you will save time and money if you ever need research done on your bank accounts…or you need to ask for a check copy from the bank. If you do not have room to store these records, keep the last statement of the previous year and the rest can be shredded.

Credit Card Statements: A similar situation to bank records.  They provide a history of your purchases and actually your whereabouts for specific dates and times.  I have gone back to these statements more often then I would have thought.  If you have tax related purchases you need to keep the statements at least 7 years.  If your end of the year statement is accurate and you don’t have room in the box…they can be shredded.

Utility Bills:  If your accounts are current and show your most recent payment they can be destroyed.

Pay Check Stubs: Keep your stubs for the current year.  If your W-2 agrees with your pay stub they can be destroyed.

The Box:  Close up the box and label it “Financial Records 2004-2008” or whatever years apply.  In fact if there is more room your box, leave the end date open until the box is full.  If the box is full also put “Destroy: December 2015” or 7 years from the end date, and up to the attic it goes.

There are papers or documents that should never be destroyed.  Legal documents of any kind should be permanently saved and protected.  Those include diplomas, college transcripts, marriage license, birth or death certificates, mortgage satisfactions (even if you no longer own the home), court papers, employment records, social security numbers and passport documentation.  This is not an inclusive list.  There is a wealth of information available to you on the web if you search under record retention. 
You know what? I didn’t need that Excedrin after all.