Even the most organized of people may find managing financial documents and paperwork a challenging task. Getting your financial house in order can save time and money, make tax filing less stressful and ensure that your loved ones have access to important financial documents in the situation of an emergency.
Whether you’re storing digital or physical files, you should create a system that works for you. Start by putting all the documents you’ve got in one place. Look over your kitchen counters the entryway table, the home office desk and garage, car trunk and everywhere else papers collect. Throw away junk mail catalogs, coupons, expired coupons and bill inserts. Keep receipts and product manuals for large purchases.
Sort your paper documents according to category. For example, bank statements can be sorted according to date, and then categorized into folders based upon the kind of account (such as credit card accounts). The organization of your files by category will also make it easier to find the information you need when you need it. If you have several accounts, like “auto” or “home” Consider using subfolders. You can also sort by year. This is particularly useful when it comes to audits and tax season.
Once you’ve categorized your documents and divided them into years, make sure to go through and dispose of old files in accordance with legal retention guidelines. Regularly back up your files to reduce the risk of losing vital information. If you’re sharing files with colleagues take a look at document management software to centralize the entire process.