It is hard to know which documents to save and which ones to discard. Before you know it, your spare room, office, attic, basement, or garage is overflowing with boxes of papers that all seem important. Trying to weed through them and figure out what to toss? Keep reading.
Which Documents Should I Keep?
There are some documents that you will want to hang onto forever and some that you should keep for a few years. Consider the following:
Documents You Should Always Have
These following should always be available, and you should properly store them to ensure you can retrieve them when you need them:
- Birth certificates
- Death certificates
- Marriage license
- Social Security card (Lost yours? Now you can request a replacement online.)
- Your current insurance policies (life, health, etc.)
- The newest version of your estate planning documents
Documents You Should Only Keep Temporarily
Some documents lose importance as time goes by. However, it would help if you kept the following for several years (typically, seven years):
- Papers related to charitable donations
- Tax returns
- Credit card statements
- Cancelled checks
- Bank statements
Why Is It Important to Keep Some Documents?
Should you pass away, it is crucial to have kept certain papers because the court may request them after your death and they can help your family close your estate.
Other reasons to hold on to paperwork depend on your situation. For example, some people find themselves a party to a lawsuit. If that happens to you, you may need to produce certain paperw0rk, and it will be much easier if you can readily access the important ones.
Digital storage can significantly cut down on the clutter. Before you start digitizing, you want to have a plan. Sit down, look at all your papers. and determine whether they are necessary. Use a critical eye as you decide what to keep. The next step is scanning each document into your computer, on to an external hard drive, or on a flash drive.
Some important considerations when digitizing your files include keeping up to date with current technology and password-protecting your sensitive information. As technology advances, make sure that you advance with it. The last thing you want is to be unable to open your files. Always encrypt or password-protect your information. It is the best way to protect yourself against hackers and identity thieves.