Is paper clutter taking over your home? Are you constantly losing important paperwork?
If so, you’re not alone. Many people have a problem with paper clutter. But just how long do you really need to hold on to it all?
Below is a list that you can use when dealing with all of the papers in your home.
1 Month:
Bank withdrawal and deposit slips. Check your bank statement to make sure the amounts match up and then shred.
Receipts. Enter them into your monthly budget and then shred, unless you paid with a credit card. In that case, wait until your monthly statement arrives and double check that the amounts are correct. Then you can shred the receipt.
Keep your receipt if you purchased something with a warranty (keep it until your warranty expires or you no longer own the item).
Internet, Telephone & Utility Bills. Keep these for one month and then shred. If you own your own business and can write off these expenses, then you should keep the bills for 6 years.
If you own your own business and the receipt is for a business purchase, keep it for 6 years. If you purchase an expensive item (stove, television, computer), hold on to the receipt until you no longer have the item, or until your warranty expires.
1 Year:
Monthly Bank Statements. Keep these for 1 year, unless you have your own business, in which case you should hold on to them for 6 years.
Monthly Brokerage/Mutual Fund Statements. Reconcile with your annual statement and then shred.
Monthly Credit Card Statements. Keep these for 1 year, unless you have your own business and have purchased items with your credit card, then you would keep the statement for 6 years.
Monthly Mortgage Statements. Reconcile with your annual statement and then shred.
Pay Stubs. Reconcile with your T4 and then shred.
6 Years:
Tax Returns. Starting from the end of the tax year relating to the records.
All T4 Forms. Starting from the end of the tax year relating to the records.
Annual Mortgage Statements.
Receipts & Statements for Tax Returns, including: donations, RRSP contributions, child care receipts, mortgage interest, medical expenses, property tax payments, alimony/child support paid or received, etc. (Starting from the end of the tax year relating to the records.)
Forever:
Adoption Records.
Auto/Home/Life Insurance Policy Information. Keep as long as the policy is still active and then shred.
Auto Records. Keep as long as you own the vehicle.
Birth Certificate.
Death Certificate(s).
Divorce Agreement/Child Custody Orders.
Investment Records.
Marriage Certificate.
Medical Records.
Military Records.
Pension Plan Records.
Receipts for major home improvements. Keep until you no longer own the home.
Will and/or Power of Attorney.
Store all of your financial paperwork in a cool, dry place. We keep all of our monthly and forever files in a filing cabinet in our office. The paperwork that we need to hold on to for 6 years is in storage totes in our basement (it’s very dry down there and they are up off the ground).
Remember that if you do own your own business, you need to keep your business paperwork separate from your personal paperwork, to avoid hassles if you are audited.
How do you store your financial records?
Sad thing is I trust what Ms January posts online a lot more than anything I was ever told by the accountant I used for years. Some of them dont know what they are doing.(Of course many do! but check their qualifications, many have only taken a couple courses and then claim to be an accountant!) THis one in particular that Im refering to knows very well how to scam the system so they pay little to no taxes.
I personally dont see how Ms January could be liable for what she post on her personal blogs, quite frankly if a self employed and or buisness owner didnt get all the details straight from the Government than they are responsible. Just my thoughts anyways.. Thanks N@ for updating the blog with the correct amount of time !! THanks everyone for the other comments, some great ones!!
Shirley Johnson: There are dozens of website articles with similar information online.
Kirsty: Good point, I will make a note of that.
If you purchase something that has a warranty, you need to keep the receipt to be able to return, exchange or repair under the warranty.
Wow! You are a brave lady putting this online. There is a liability issue when you make these statements for public information.
People should check with their accountant for the latest information – and, no, I am not an accountant looking for business.
Spelling: indefinitely
N@ – Thanks for the clarification!
Corporate records legally need to be kept for 7 years not 6 years according to Revenue Canada. I keep mine for 8 years just in case of an audit.
travelgeek – Great suggestion! I plan to get a safe and keep all important documents in there, and then just photocopies in my filing cabinet.
I’d suggest photocopying or scanning any important receipts needed for warranty or tax purposes that have been printed on thermal paper as they have a tendency to fade over time.