Step 4: Create a regular decluttering routine.The key to maintaining your new paper management is to create a regular routine for processing what comes into your home. Here are four tips to help you stay on track on a day-to-day basis:
- Sort the mail daily. Stand near a trash can as you sort and immediately toss what you don't want to keep.
- Create a specific place for paying bills and correspondence.
- Create a family communication area with a family calendar.
- Set aside time for filing at least once a week.
In addition to purging paper on a daily basis, you'll want to take time throughout the year to evaluate your reference papers and rid yourself of any outdated or unneeded info. Here's a guide to understanding what financial records and other important papers you should keep and for how long:
Be sure to consult your CPA or financial consultant as to the length of time to keep papers that specifically pertain to you and your family.
Items you may toss after one year:
- Monthly bank and credit card statements (if you don’t itemize deductions)
- Monthly or quarterly brokerage statements after reconciling. You do need to keep any buy/sell statements and reconcile with the year-end statement.
- Monthly mortgage statements but keep the year end statement which shows all interest and taxes paid.
- Paycheck stubs once you’ve reconciled them with your annual W-2 or 1099 forms.
Items to retain for seven years:
- W-2 and 1099 forms
- Year end statements from credit card companies.
- Any business expenses that you claim.
- Annual mortgage, property tax or any tax-deductible expenses
- All papers that support your tax return for the past 7 years. You can then purge the supporting documents and just keep the return.
Items to keep forever:
- All annual tax returns
- Year end summaries from financial services companies.
- Information on the purchase price of all investments.
- Home improvement records.
- Receipts for major purchases as long as you still own the item.
- Beneficiary designations
If you are claiming a home office on your tax return, you will need to keep everything that relates to those expenses such as, utilities, rent or mortgage payments, office expenses, phone expenses, computer expenses. Keep a file for each category that you list as a deduction.
If you are not claiming a home office deduction, you may toss the following each month:
- Bank deposits and ATM receipts after recording them in your check register.
- Credit card receipts after you have checked for accuracy on your statement.
- Sales receipts for everyday purchases if there is no warranty.
- Utility statements when the next month’s statement arrives.
Carol Keller is the owner of Organizing Experts, LLC, (OrganizingExpertsla.com) a professional organizing company located in the Los Angeles area.
