Trying to keep important documentation organized? It can be difficult to know how long to keep paperwork. Some items it’s wise to hold onto indefinitely, while others you are safe to shred after a few months. Since we’re in the midst of spring cleaning, here is our handy reference guide for how long certain documents should be kept.
Keep Forever
- Birth and death certificates
- Social Security cards
- Marriage licenses
- Divorce papers
- Military discharge documents
- Life insurance policies
- Wills and living wills
- Optional: Tax returns
It can’t hurt to keep your tax returns forever. An electronic or physical copy of each year’s tax return and any payments you make to the IRS are always great to be able to reference when needed. This rule of thumb can be applied to general financial documents from inheritances to life insurance policies.
Keep 3-7 Years
- Bank statements
- Brokerage statements
- Charitable payment receipts
- Insurance policies (until they lapse)
- Investment records
- Previously-submitted tax returns
- Sales receipts (or until their warranty expiration date)
- Tuition payment receipts
It’s possible that theIRS may ask you for supporting documentation up to seven years back based on your filing circumstances. Because of this, it’s a good rule of thumb to save any document that verifies tax information from the last three to seven years. This can include your W-2 and 1099 forms, bank and brokerage statements, and more.
Keep 1 Year
- Annual 401k statements
- Paychecks and pay stubs
- Receipts for large tax-deductible purchases
- Records of charitable donations
- Stock purchases
Keeping copies of your monthly credit card or bank statements from the previous year is also important. Additionally, it’s smart to hold onto your pay stubs in case they are needed to verify financial information during tax season.
Keep Less Than a Year
- Bank statements
- Credit card statements
- Cell phone bills
- Utility bills
Usually it’s safe to dispose of your utility or phone bills after your payment has been processed, unless you’re self-employed and need them for tax purposes. After confirming your bank withdrawal and deposit slips against your monthly statement, you are good to shred those as well.
