Do You Really Need to Keep All Those Papers?

Chances are you are storing more than you need, especially if you have more than a year's worth of annual reports, credit card statements, pay stubs, bank deposit slips, insurance policies and cancelled checks.  If that's not enough to get you to fire up the paper shredder, keep reading.

Hanging on to every scrap of paper is not just a fire hazard; it can also be an impediment to heirs or caretakers sorting through your belongings down the road. That said, what you keep and how long you keep it can be just as important as where you keep it.  And by the way, it's no small exercise. 

HIDE AND SEEK

The elderly are attached to their papers; they have been trained to keep important papers, even when they are really not important.  And oftentimes, they won't allow you access to these files so you have no idea what's in those file cabinets and drawers.  So when you finally get the opportunity to see things, you may well be horrified at what you encounter.   Paperwork going back 15, 20 or 30 years is not uncommon.  This is an experience I recently encountered and going through this has.

Now, let's turn the cards around a bit when you can't find important papers.  Misplaced paperwork isn't the only problem you'll likely encounter when sorting through paperwork. After the death of of a loved one, you have to go through all of that paperwork that has been piled in draws for years or even decades.  The first question you are confronted with is do you know where all the assets reside? Is there a safety deposit box somewhere?  Where is the key?  Oftentimes, these questions should be asked long before someone becomes sick.  What about the car title?  Where could that be?

URGED TO PURGE

The chart below tells you how long to save important papers, including wills and insurance policies, and where to keep them. But before you start tossing, make sure you have a working shredder, or be prepared to start ripping. Identity thieves thrive on account numbers and other personal information on tossed paperwork. Also, organize the documents you keep in loose-leaf binders or in file folders where they'll be easy to find.

Finally, make a list of your important papers and their locations that you or the person you've designated to carry on your affairs can consult for quick access. Include details about how to find your safe-deposit-box key, the combination to your home safe, and your computer log-ons and passwords. Give the list to loved ones and be vigilant about updating it.

It's also a good idea to keep copies of your most important documents in a single location so they'll be easy to grab in case you need to evacuate your home. Some items to include in that pile: passports; account numbers for your bank, broker, and utilities and other bills; family immunization records; Social Security numbers; computer PIN numbers; and photos of your family and pets for identification. You should be able to grab that stuff, put it in a suitcase, and be out of your house in a half-hour.

 

Note: For documents in a safe-deposit box, it's a good idea to keep copies at home as well.