Plenty of resolutions are made this time of year, and a lot of them have to do with health or fitness. But there’s another area of your life that could probably use some improvement. Your financial health is just as important as your physical health, so why not take the time to get organized?
Anyone who has ever faced difficulty finding an important financial document can attest to this fact: financial disorganization can add a major stress factor to your life! To get started with your new project, first ask yourself a few important questions:
What do I need to keep? Certain documents must be kept in paper form in a secure location, such as identity documents and legal contracts. Others are commonly stored elsewhere, and you may not need to keep a copy at your house. For example, if you have online banking and can print past statements at any time, there’s no need to keep that clutter around your home.
How long should I keep it? There’s no need to keep records any longer than you’ll actually need them, because otherwise they clutter up your entire system and make it difficult to find the things you do need. Things like receipts, credit card statements, utility bills, and annual insurance policies don’t need to be kept for more than a year.
More important documents, which should be kept indefinitely, include:
- Tax returns
- Mortgage contracts
- Receipts for major purchases
- Property appraisals
- Retirement and investment statements
Obviously, you need to keep things like Social Security cards, marriage certificates, passports, birth and death certificates, adoption papers, citizenship papers, and military discharge papers forever.
Where do I keep it? There’s nothing wrong with a filing cabinet, but a large fireproof might be a better idea in the event of a natural disaster. Storing files on your computer is also a good idea, but remember to back up everything on an external drive (or a flash drive which you place in a fireproof box). Cloud storage is another great idea, so that you can store important files remotely on the internet and access them from any location (don’t worry; everything is password protected).
