I am going to share with you a few financial organization tips, but before I do….
you need to know that I am a paper girl. I still haven’t completely given into the digital age. Yes, I know all of my bills can be changed to paperless statements, and yes, I know important documents can be scanned and saved to a hard drive. However, for me, I want physical copies. No judgement, Judy.
Financial organization tip numero uno:
You do not have to spend a ton of money to get organized. I did not go out and buy anything new to organize my financials, I just reused the folders and binders I had laying around the house. With a little bit of white out and a sharpie, I had “new” folders and tabs. YAY for frugalness!!
Starting with the file drawer in my desk where I kept all my bill statements. I emptied the drawers and began going through each folder’s contents. Next, created a pile for the papers that needed tossed, a pile for empty folders that could be reused, and a pile for the folders that already had been purged. I repeated this process for the remaining file cabinets.
Financial organization tip numero dos:
Now when I say “toss” I don’t mean toss in the garbage. Shred all financial and important documents before disposing. Since I live in the country we take the extra step and burn the papers. We make a small campfire and pull up chairs and enjoy the evening!
Financial organization tip numero tres:
As I sorted purged folders, I created new labels and folders for each utility and bill that we have. I then arranged the folders in the top drawer of the filing cabinet in order of due date. For me, this will be the easiest for me to maintain organization. Creating a system is important to maintaining organization. Think about how you pay bills and what will be the easiest and most efficient way to organize your paperwork.
Financial organization tip numero quatro:
There is a recommended time period for how long you should keep your financial and important papers. Here is what I do for mine.
Utilities: I keep for one year. You technically only have to keep for one month but I like to be able to review at the end of the year. This helps me budget more accurately for the coming year.
Credit cards: I keep my credit card statements for one year as well, though you technically only have to keep for one month. I also review at the end of the year as well to see where we need to cut back.
Car payments: I do keep all payment stubs for car payments until they are paid off and I have the title.
School and Real Estate Taxes and tax returns: I keep for 7 years but should be kept for a minimum of three. You can find more info on that here:
Paystubs: I only keep for one year.
Health care statements and bills: I keep these indefinitely. I have read that you should keep health records for at least a year to five years depending on certain circumstances. I staple the medical bill to the EOB and then at the end of the year staple all the bills and records for that year together. Each family member has their own folder so it is easy to find what I need when I need it.
Stocks/ IRA’s – I keep all records for our stocks and IRAs indefinitely. I found this article from Forbes to be helpful and used this information as a guideline. I had originally created binders for each IRA and Stock. However, I found binders I had forgotten about that worked better. They have a hanging system so I could hang them in the back of the file drawer and I could free up shelf space !
Life insurance policies: I keep all documents indefinitely.
Warranty info: I keep all warranty info till it expires or I no longer have the item.
Passports: I keep all documents related to my passports indefinitely.
User Manuals: I only keep user manuals a few things. Most user manuals can be found online if needed. However, I do keep my appliance ,tool manuals, car seat manuals, manual for our furnace, well pump, water softener system, etc. I had an old accordion style binder that I had cleaned out that worked perfectly to store the manuals. I was able to organize them so that each manual was easy to find should I need it on a moments notice.
Organizing our financial and important paperwork proved to be a much harder task than I anticipated. I constantly was revising my organization methods as I moved along, but was finally able to create a system that worked for me. I was also able to condense all our paperwork into ONE file cabinet. It is so refreshing to open the drawers and know where everything goes! No more rummaging through folder upon folder looking for the ever illusive statement or bill.
We were also able to get rid of the huge desk we had in our bedroom, just by organizing our financial and paperwork!! We have so much more room and I will be able to finally be able to rearrange our room the way I want!! ***Insert high pitch girly scream***
Have any other tips on how to organize your financials or how to maintain organization? I would love to hear them !!
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