Money Matters

Organizing Financial Paperwork

December 31, 2013 | Alliant Credit Union

Organizing financial paperwork can be challenging for many reasons, no matter the situation. It could be due to the sheer volume of paperwork, space limitations or time restraints. But with the start of a new year, now’s the time clear up that "I'll get to it later" stack of papers that keep getting put off until tomorrow. Getting started is the first step to being organized, and below, we’re sharing six steps that can help you get started on your financial organizational journey.


STEP ONE
: Collect

Gather all of your financial documents, including paperwork, bills, unopened mail and documents saved on your computer.


STEP
TWO: Develop a System

Develop a system as to how you want to categorize and organize it all. Following is a list of categories to help you get started. Note that not all categories may work for your system due to your personal situation, preferences or the quantity of documents you have for a specific category, so you'll need to adjust based on your specific needs. It's likely that you have a combination of electronic and paper documents, so as you begin to organize your papers, you should also be organizing the financial documents on your computer the same way.

Categories

  • Advisors: List of names and contact information for all of the important people and institutions in your financial life
  • Auto: Titles and maintenance records
  • Bills Due: Bills that need to be paid
  • Contracts: Legal agreements and employee contracts
  • Credit Cards: Annual credit reports, current monthly statements and any older statements that include expensive items that are under warranty through the credit card company
  • Credit Union/Bank Accounts: Monthly statements until it is reconciled and then the next monthly statement when it is received
  • Education: Enrollment records, diplomas, certificates, grades, transcripts and progress reports
  • Employment: Paycheck stubs, evaluations and handbooks
  • Healthcare: Medical records, vaccinations and receipts
  • Home Repair & Maintenance: Records and receipts for any home services, repairs or equipment.
  • Insurance: Policies for home, life, auto, medical, etc.
  • Investments: Investment account statements, brokerage account records, mutual fund statements, retirement plans, IRAs and all other documentation for your investments
  • Loans: All documents pertaining to a loan on which you still owe money
  • Miscellaneous: Any documents that you're not sure where to file right now
  • Read: For any financial documents that you can't read right now, file them here to read at a more convenient time
  • Tax Records: All documents for the current and last three tax years – W2s, 1099s, receipts and other items
  • To Do: All pending finance-related projects should be filed here
  • Utilities: Current monthly statements for all utilities
  • Warranties: Warranty information for appliances still under warranty
  • Wills, Trusts & Estate Planning: Current, executed estate-planning documents and beneficiary designations


STEP THREE: Separate

Now it's time to separate your documents into five stacks:

  • Bills Due
  • To Do
  • Read
  • File
  • Shred

As you're going through your paperwork, read through it and consider the following questions to determine whether you should file or shred it. If you're at all unsure, keep it.

  • If I shred this, what's the worst that could happen?
  • Can I get another copy?
  • Will I need this later?

 
STEP FOUR: File

Place all the paperwork that you've identified as Bills Due in the appropriate folder. Then file what's in the To Do and Read stack in To Do or Read. Now you'll want to organize all the documents in the File stack based on the categories that you're using. If there are documents you're not sure about, file them in Miscellaneous until you know where they should be filed. Store all of your paper files in a convenient location that you can access when you need something – it'll save you time. Lastly, shred and discard of all of the paperwork you no longer need.

 
STEP FIVE: Repeat

Every time you receive mail or additional financial paperwork, complete the process and follow steps three and four. This will help you avoid another stack of paper in your home office, on your kitchen table or wherever else you're current stack of paper is residing. Develop a system that:

  • Works best for the amount of time and space you have
  • You can make it into a routine
  • You can stick with for a long period of time


STEP SIX: Go Electronic

One big way to reduce the amount of financial paperwork you have to file is going paperless and receiving all statements electronically. It's easier to search for a document on your computer than going through file folders by hand. Plus, it takes up less space. For documents that only come in paper form, you can consider scanning them into your computer and then shredding the paper copy.

How you manage your financial paperwork can make a big difference in your financial life!


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Sources: Bankrate.com, Dummies.com, MSN.com

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