How not to get buried in paper records
July/August 2010 Print this Article

It doesn't take many years as an adult to become overwhelmed with paper records. We pay bills, buy cars, purchase houses and buy investment and insurance products. What do we keep and for how long? Every person will have different requirements, but the following suggestions may help.

Tax records -- Talk to a tax professional or go to the IRS's website to get more specifics, but generally the IRS's word on this subject should be heeded. The agency recommends that you keep tax returns and their associated records at least three to seven years, depending on the type of records, the sufficiency of your tax payments and other factors. If you sell an asset you held for a long period of time, you even could hold your tax records for decades. For example, you would want to hold your mortgage and other home-related records as long as you live there, plus the IRS's statute of limitations period.

Bank receipts -- With the advent of online banking, you can go online to retrieve many banking and other online financial records. Thus, you might throw away paper records of deposits and withdrawals, for example, as soon as they post to your account.

Do you need paper? All of this paper can take up space, but you can put them on a disk with the variety of software that's available today. Even paper-only records can be transferred to disk by scanning them to a file format your computer software can read.

FINRA Reference #FR2010-0331-0157/E 05/28/10

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