If something were to happen to you, would your loved ones be able to find the documents they need to settle your estate? If you needed to leave your home in a hurry, could you grab these papers quickly? It’s important that these documents are in a safe place and well organized. Let’s take a closer look at how to organize your important documents.
Sort the Paperwork
This is something that many people dread. Sitting down to sort through possibly years and years of paperwork can be daunting. However, we often hold onto papers we don’t actually need.
Utility bills, sales receipts for small purchases that aren’t deductible, and ATM/deposit slips can be trashed within one to three months. You need to keep checkbook ledgers, paycheck stubs, monthly mortgage statements, and expired insurance records for one year.
Now, the seven-year mark paperwork includes bank statements, tax forms and receipts for items deducted on your taxes, cancelled checks, disability paperwork, unemployment pay stubs, and medical bills/claims.
Paperwork you need to keep indefinitely includes deeds, annual tax records, medical records, wills, estate plans, living wills, documentation of home repairs, and many other things you will need for more than seven years.
You next want to shred anything you don’t need. Make sure to shred this paperwork because many of the items you’ll be tossing have important information that could be used for identity theft.
Purchase a Life Organizer
There are many types of life organizers out there. The purpose of these organizers is to have the information someone needs in case something happens to you. It can include your bank account numbers, where to find important paperwork, medications you take if you’re still alive but unable to respond, etc.
You want to label file folders so that everything is easy to find. Because these are important documents, you may want to file things in a portable file holder so that it’s easy to take with you. This can then be stored in a fireproof safe until needed.
The hardest part of this process is weeding out all the papers you no longer need. This can take several hours. Give yourself plenty of time to work on the project. No one said you had to do it all in one day. The important thing is that you get started.