Are you looking to get organized for the new year?
If so, you’re not alone. But before you start clearing out your cabinets and drawers to get rid of old financial documents, you need to lay out a plan for what to keep and what to throw away.
Keep reading for more information on how long to keep documents and when you can toss important ones.
How Long to Keep Documents
Most of us are afraid to destroy documents that we might need in the future. So we never get rid of them and end up drowning in drawers full of old paperwork.
To help you get organized this year here’s an easy guide on how to keep documents:
Holding onto some financial records might make you feel better, but there are some that you’ll never have a use for again. Items such as utility bills, cable bills and deposit/withdrawal receipts only need to be kept and stored for about a month.
Keeping them for thirty days after helps you ensure that nothing is wrong and serves as proof that they’ve been settled. After the month mark, problems will rarely come up and they’ll just be taking up space in your drawers.
For peace of mind, have your bank, utility company or other institution send you digital copies of your receipts. Organize these items on your computer or external hard drive in case you need to reference anything later.
You should keep a copy of your monthly credit card and bank statements for at least one year. You should also keep your monthly pay stubs. If your company doesn’t automatically generate pay stubs for you, you can use an online pay stub creator to keep a record of your paychecks.
Three to Seven Years
The IRS recommends that you keep certain tax documents three to seven years after you file your taxes. During this period, they might ask for supporting documents if questions arise about your taxes. Check out the IRS website for more information before you get rid of any documents.
Even though it feels good to purge old documents, there are some you need to hold on to permanently. The documents you should keep include a copy of your yearly tax returns and any other major financial documents.
Just like your birth certificate, will, and social security card, these documents should be kept in a safe place so you can easily reference them anytime you need to.
How to Dispose of Important Documents Properly
Once you’re ready to get rid of documents, make sure you’re getting rid of them in the right way. Always shred your documents with a professional shredder. Identity theft is a big problem, and people often dig through garbage and steal private information.
Learn More Life Tips and Tricks
Now that you know how long to keep documents organized, there are probably other areas of your life that you’re looking to change this year as well.
Check out the rest of our website for more tips that will help you clean up and organize every aspect of your life. For example, if you’re looking for a new job, check out this article on career paths in the medical field that are currently in demand.