Even the most organized individuals are able to find managing their finances and documents a difficult task. Getting your financial home in order can save time and money, make tax filing less stressful and ensure that your loved ones have access to vital financial documents in the event of an emergency.
You should create a system for the storage of your files, whether they’re digital or physical. All your documents should be kept in one spot. Examine your kitchen counters, entryway tables desks at home offices garages, car trunks and anywhere else you collect papers. Discard junk mail catalogs, coupons, expired coupons and bill inserts. Keep receipts and guidebooks for major purchases.
Then, organize your papers into categories. Bank statements, for example, can be organized by date, and then categorized into folders based on type of account (such as investments or credit card accounts). The organization by category helps to locate what you’re searching for when you require it. If you have multiple accounts, like «auto» or «home», consider using subfolders. You can also sort your accounts by the year. This is particularly helpful when it comes to audits and tax season.
After you’ve sorted your paperwork into years and then divided them into groups, ensure that you review old files and dispose of them according to legal retention guidelines. Make sure to regularly backup your files to reduce the risk of losing important data. Consider document management software in the event that you share files with colleagues.