Home Forums Welcome Hello! Favorite list/guidance about keeping financial files?

This topic contains 16 replies, has 11 voices, and was last updated by Profile photo of foilhead1 foilhead1 2 years, 5 months ago.

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  • #159729
    Profile photo of T
    T
    Member

    I know I’ve seen people post links to these lists but I can’t find them :( sorry! I’d love to know your go-to list about what to keep for how long. I’m in the US so need to deal with US tax retention guidelines. Because I claim a home office deduction, I figure I need to keep my utility bills for the 7 or so years I need to keep tax returns, right? Do you all trust the utility companies to have your bills handy on line in a few years if you need them? or keep paper? My systems are predominantly paper-oriented right now, but I’d like to reduce the file cabinet space required!

  • #204017
    Profile photo of smallLife
    smallLife
    Member

    Favorite list/guidance about keeping financial files?

    I’ve never seen a list like this all in one place. I had always heard/read utility bills for a year, but I’m not sure since they are coupled with a home office exemption (in which case they should be filed with taxes after the year).

    If a company has them online, I print to pdf and save them on the computer – periodically backing up to an external hard drive. That would reduce some of the paper, and there is theoretically a back up online.

  • #204020
    Profile photo of loripax
    loripax
    Member

    Favorite list/guidance about keeping financial files?

    Most companies that do online billing/reporting limit how far you can go back to retrieve old bills/statements. My credit union credit card statement go back six months; my local bank statements go back one year; my credit card processing account goes back only three months. I would save a PDF, as @smallLife suggested, anything related to finances in general, but taxes in particular. And yes, if you’re taking a home office deduction, anything related to how you calculate that deduction should be kept with your tax stuff.

    I don’t take a home office deduction, so I keep stuff like utility bills, bank statements, and credit card statements until the end of the following year. For example, soon I will be clearing out unneeded papers from 2010 — i.e., the newest thing I will be getting rid of is just over one year old.

  • #204023
    Profile photo of smallLife
    smallLife
    Member

    Favorite list/guidance about keeping financial files?

    You prompted me to look into my own recordkeeping. I found this

    http://www.goodhousekeeping.com/home/cleaning-organizing/important-papers-to-keep

    Which brings me to a question – for documents that you are “supposed” to keep forever (Roth IRA statements to prove you already paid taxes for example) but are received online, do you print them out?

  • #204025
    Profile photo of smallLife
    smallLife
    Member

    Favorite list/guidance about keeping financial files?

    Another one

    http://www.bankrate.com/finance/personal-finance/how-long-to-keep-financial-records.aspx

    They mostly overlap. Tax stuff for seven years, IRA yearly statements forever, house stuff forever, bank statements only if tax related (7 years), brokerage statements as long as you hold the securities (+7 yrs for taxes)

  • #204034
    Profile photo of Demerna
    Demerna
    Member

    Favorite list/guidance about keeping financial files?

    I know this doesn’t answer your question, but the IRS has been accepting electronic/digital versions of taxes and expense receipts since 1997. You can read more about it at http://www.irs.gov/pub/irs-irbs/irb97-13.pdf starting on page 10.

    “This revenue procedure permits the destruction of the original hardcopy books and records and the deletion of the original computerized records (other than ‘‘machine-sensible’’ records required to be retained by Rev. Proc. 91–59, 1991–2 C.B. 841), after the taxpayer: (1) has completed its own testing of the electronic storage system that establishes that hardcopy or computerized books and records are being reproduced in compliance with all the provisions of this revenue procedure; and (2) has instituted procedures that ensure its continued compliance with all the provisions of this revenue procedure.”

  • #204060
    Profile photo of T
    T
    Member

    Favorite list/guidance about keeping financial files?

    Thanks for the resources, advice and ideas! This must be my project for February… I must… I must…

  • #204078
    Profile photo of Ella
    Ella
    Member

    Favorite list/guidance about keeping financial files?

    Here are guidelines from some of the personal finance blogs that Erin Doland recommends…

    Get Rich Slowly:
    http://www.getrichslowly.org/blog/2006/08/03/which-financial-records-to-keep-and-how-long-to-keep-them/

    Wise Bread:
    http://www.wisebread.com/to-shred-or-not-to-shred-how-long-to-keep-your-tax-records

    The Motley Fool
    http://www.fool.com/taxes/2000/taxes000623.htm

    And finally, here’s Erin on the importance of paper records:
    http://unclutterer.com/2008/04/08/how-to-store-your-tax-returns/

    In the Comments, she reiterates this rule of thumb:
    If it comes from the government or if it was prepared for the government, keep it.

  • #204085
    Profile photo of Rosa
    Rosa
    Member

    Favorite list/guidance about keeping financial files?

    The 7 years rule applies to dead people, too – my mom got audited on her dad’s estate several years after his death.

    And, personally, I keep paper copies (or .pdfs would be fine, I just still habitually keep paper) of contract utility statements for the length of the current contract, and final credit card statements on any accounts I close, because I do not trust the cell phone company or the credit card company one little bit. I would if I had a dish or cable account, too. Our cell phone contract has been 2 years at a time, so that’s how long I keep those.

  • #204099
    Profile photo of Jackthetiger
    Jackthetiger
    Member

    Favorite list/guidance about keeping financial files?

    It is a bit rough to be assessed by the Tax Office after one’s death!

  • #204125
    Profile photo of shebolt
    shebolt
    Member

    Favorite list/guidance about keeping financial files?

    I prefer to err on the side of keeping too much, but I finally learned to get rid of utility bills immediately.

  • #204138
    Profile photo of chacha1
    chacha1
    Member

    Favorite list/guidance about keeping financial files?

    DH and I use the home-office deduction too (he’s a freelance personal trainer/physical therapist assistant, so even though he pays rent to a gym to take his clients there, the business is technically “operated” from home).

    We keep all utility records for the full seven years. I use Really Useful Boxes (19 liter size) which are big enough for all the utility bills, credit card statements, Schedule C Receipts file, client payment records, bank statements etc etc, one box per year.

    It took me nearly two years to get all the records organized this way but now the full seven years’ worth, plus current year, fit in our linen closet. When a year expires I pull it out and take almost everything in to my office to dump into the big secure-destruction bins (not about to shred all that mess at home on our machine). Then I relabel the box for the upcoming year.

    What I keep forever: copies of the actual tax returns; year-end investment account statements; business tax reports. That’s about it. Those go into our home-office file cabinet.

    p.s. we changed the doorknob on our linen closet to one that locks with a key. When we are away, or when workers need access to our apartment, we lock the door.

  • #204173
    Profile photo of Irulan
    Irulan
    Member

    Favorite list/guidance about keeping financial files?

    I follow most of the advice above, although I haven’t yet reached 7 years of tax filing. I also keep pdf copies of my annual credit reports. I’ve had to send copies of old credit reports to the state attorney general’s office (in my particular case, it was to dispute a fraudulent collection that re-appeared on my report after 4 years). I’d also suggest that you keep any paperwork regarding financial disputes indefinitely.

  • #204389
    Profile photo of Ella
    Ella
    Member

    Favorite list/guidance about keeping financial files?

    T: I’m also organizing my papers this month, and I’ve been reading through the Unclutterer archives for relevant advice. Here’s Erin’s straightforward list of documents to keep or shred:

    http://unclutterer.com/2007/05/07/paper-clutter-begone-part-4/

  • #204402
    Profile photo of T
    T
    Member

    Favorite list/guidance about keeping financial files?

    Thanks, Ella!

  • #211754
    Profile photo of foilhead1
    foilhead1
    Member

    Favorite list/guidance about keeping financial files?

    The Freedom Filer System.

  • #211755
    Profile photo of foilhead1
    foilhead1
    Member

    Favorite list/guidance about keeping financial files?

    forgot to give the link! Freedom filer:

    https://freedomfiler.com/Home.cfm

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