Which Records to Keep or Shred

Posted by: Sophie H. | Jan 13,2008

With identity theft so rampant, there’s been talk about shredding documents so they don’t get into the hands of identity thieves.  A basic paper shredder can be bought for pretty cheap from any office supply store.  I could imagine a time when everyone’s got one in their home office.  But with so much paranoia about identity theft, especially in senior communities, people might shred documents that they’ll need in the future.  

For example, it’s recommended that you keep monthly bank statements for at least seven years.  This is one area where I could imagine people checking their bank statement and then shredding it immediately.  It can be cumbersome to save seven years of monthly statements, but it’s a good idea to have them on hand in the case of an IRS audit.  Note: when you’re picking up a paper shredder at your local Staples, also look into a locked box for all those documents you don’t shred.  

You shouldn’t necessarily shred all loan documents.  After a loan is paid off, the documentation is not entirely necessary to keep around, except in the case of a mortgage, which you’ll need at resale.  

Investment paperwork is different than bank statements.  You should shred your monthly investment statements, but keep your annual statement.  The same goes for annual retirement account statements for a 401(k) and IRAs.

Credit card receipts should be kept for a year if it’s for a purchase that may need to be returned or accessed for future warranty purposes.  Bills should be kept around for tax time if there’s any itemized expenses that need to be deducted on your tax forms.  

All in all, you should shred some paperwork, but don’t go absolutely shred crazy.  If you’re unsure if you should keep something around, keep it in a secure location.  

Sponsored Resources Ads by Google