Many adults have lost
money due to poor financial organization and do not even realize it. For
example, millions of people have unknowingly lost track of their (or a
relative’s) pension documents over the years, which has left over $300 million
in unclaimed pension benefits. Maintaining organized financial files can save you
money and time, and it is an important habit to develop as you get older and
your finances get more complicated.
People usually lose track
of their financial documents because they have too much financial paper work
that is kept in no particular order. There are many ways that you can avoid repeated
costs of disorganization.
-
Collect
all your life documents and back them up – Life documents include birth
certificates, marriage licenses and divorce decrees, life insurance policies,
and wills. Keep these documents forever, as they can affect your and your
relatives’ financial situations well into the future. Gather and store them in
a secure place. Back up these documents by scanning and uploading them onto a
password-protected Flash drive or a Cloud account. Keep the Flash drive in a
safe deposit box for extra safety. But never shred these original documents!
-
Go
“paperless” to avoid the trouble of searching through files – Many companies
can send your bills electronically. You can download the documents into computer
files. Organize the computer files by type and date, and password-protect them.
-
Routinely
shred documents that you do not need anymore. This will keep you from losing
track of your more important papers, such as recent bills. This table shows
what items you can dispose of and how often:
|
Item
|
When
to discard
|
Shred
it?
|
|
Tax
documents (W-2s, 1098s, 1099s, etc.)
|
After
7 years
|
Yes
|
|
Pay
stubs
|
After
1 year
|
Yes
|
|
Bank
statements
|
After
1 year
|
Yes
|
|
Bills
|
After
1 year
|
Yes
|
|
Credit
card statements
|
After
45 days
|
Yes
|
|
Warranties
/ product manuals
|
When
you no longer own the product
|
No
|
|
Life
documents (birth certificates, wills, insurance policies)
|
NEVER
|
No.
Always keep in a secure, easy-to-find place.
|
READERS, what
do you think?
Were
you aware of all the documents you need to be keeping? Where have you kept
important documents so far? Are you able to find warranties (on your cell phone,
for instance), proof of insurance (in case you are stopped by a police officer),
or your car title (which you will need when it is time to trade for a newer car)?
And where do you keep your checks? Would having an organizational system help?
References:
Intuit, Inc. (2014,
February 28). How to spring clean your finances: A visual guide to getting your
financial house in order. Mintlife.
Retrieved from https://www.mint.com/blog/how-to/how-to-spring-clean-your-fianances-a-visual-guide-to-getting-your-financial-house-in-order-0214/?display=wide.
Haithcock, S. (2013,
April 9). Finding lost money is real; billions unclaimed. MarketWatch, Wall Street
Journal. Retrieved from http://www.marketwatch.com/story/finding-lost-money-is-real-billions-unclaimed-2013-04-09?pagenumber=1.
