Jun 23, 2012

What to Toss, Save or Shred While Financial Spring Cleaning

Spring is the time to clean the garbage and get rid of those heavy, useless financial papers. Knowing what to keep and what to do away with is a difficult thing. Given below is a list of documents that you should toss, shred or save for future reference.

What so Toss:

Home Improvement Documents


No one is interested in your home improvement documents, but the tax authorities. Once you get your tax cleared, it’s time to get rid of these heavy documents.

Manuals and Warranty Papers

They should be kept as long as you own the goods. Once you have disposed it or parted ways with it, you should also part ways with manuals and warranty papers. Warrantee documents are also useless once the date expires.

Receipts
They are generally of no use, until the product is a big one. These are used only in two scenarios. First, when you intend to return the good or tax concerns. Once the tax is cleared and the bought goods get old or you don’t plan on returning or exchanging them, you should do away with the receipts.

What to Save:

Credit Card Offers
Never throw credit card offers without having a good look at them. Quite often, companies offer special sign up bonuses, something you should give a thought. You never know what excellent promotion you might be losing on. Make it a habit to save these for future use. And if totally worthless, you can always send them for a toss!

Late Payment Notices

It is not a good thing to receive late payment notices from your banks or other companies. They are not the most loved possession, but something you should keep for a little while.

Quite often, these payment notices are required when settling debts. Almost all the best debt relief programs suggest you to keep them until you are sure you won’t need them in anyway.

Insurance Documents

If it is an asset related insurance document, keep it as long as you own the asset or as long as the insurance is intact. It is one of those documents that will be required quite often and must be taken care of well.
Retirement Plan Documents

These are the kind of documents you should keep in the safest place possible. Your information regarding all your future investments, retirement benefits and social security terms are important and will be used at different stages of your life.

Tax Related Documents


It is important to save them for seven years. Yes, this is a long time but as per rules, the Internal Revenue Service (IRS) has seven years to inspect your returns. However, if possible, you can convert all these files into CDs and then shred them to save a lot of space.

What to Shred:

Billing Statements

No idea why people collect a pile of billing statements. Some have a collection of bills dating back to the last decade. All these records are useless, thanks to the presence of online records now. If you have inspected everything properly, have the records online, or don’t have your goods under warranty anymore, you should trash these right away.

However, make sure you do not throw away new billing statements as you might require them for certain purposes. The date stamp is what you should look at when making the call.

The Cable Bill

This is the last thing you should keep in your files. Once verified, you should do away with these. There’s no point in collecting these as you will, in most cases, never be required to show them. They are useless once the month changes.

Canceled Checks

They can be saved or shredded, depending on different scenarios. If it’s a check from your debtor, you might save it to show it to him or her, or in legal proceedings. If you are the one who cancelled it, there’s no point in keeping the check.  It’s nothing but more burdens!

Bank Statements

Yes, they are confidential, but it doesn’t mean you have to keep them all your life. Don’t be in the habit of saving your ATM slips. They are of no use most of the times. Best debt relief programs suggest bank statements are useful for a year and should be shredded after that. Once you have reconciled your statements, it is time to do away with them.

The above article is written and edited by Roxanne, who is a freelance writer for various blogs and communities related to finance. In her free time she writes articles related to best debt relief programs, finance advises, savings and anything that is related to them.

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