Even with many day-to-day tasks moving online, there will still–and always be–paper. The average American receives almost 50,000 pieces of mail in their lifetime, and 30% of it is junk. No wonder so many of us have piles of paper items that can quickly accumulate if not taken care of. You want to tackle the stacks of paper on your desk, but you’re not quite sure how to start? Our guidelines will help you know what to save, what to recycle, and what to shred.
The Simplify Experts Paper Retention Schedule:
- All tax returns are to be kept; receipts need to be kept for the last 7 years of returns only.
- Bank statements only have to be kept for 3 years unless a key component in your 7 years of tax receipts.
- Financial Brokerage accounts – keep the current year statements. At the end of year, save only year-end and tax related forms. Trade confirmations need to be kept to prove the original price of the stock when purchased until sold. Keep trade confirmations in a labeled manila folder with your tax receipts.
- Keep all medical billing statements and prescription receipts for the year should you incur large medical expenses for that year and have enough to claim a tax deduction. If you did not meet the medical claim amount for your income, than shred all medical billing at year-end.
- You only need a couple months worth of utilities unless you run a business out of your home and are writing off a portion of those expenses to your business.
- If you believe you will be doing a wealth of improvements to your home for the life of your home, keep all home improvement receipts for capital gains tax when you sell the home.
Paper Clutter Flow Chart
This provides a more visual guideline for organizing your papers. Click on it to see it in full-size, print it out, and post it above your desk, kitchen table, workspace–wherever you’ll be rolling up your sleeves and tackling that paper pile.
As always, if it feels too daunting, we really would like to help you build a paper flow system…our clients find it to be incredibly empowering.