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Create the Perfect Filing System

Don’t Agonize. Get Organized!

If you’re like most people, you’ve got a pile for this and a pile for that. Probably because you don’t have anywhere to file your piles. As you get ready for another tax season, it’s the perfect time to finally get a filing system in place. Just follow this “recipe” for peace of mind.

To get started you’ll need some filing gear: manila (or colored) folders, hanging files, labels, sticky notes, and maybe a magic marker or two.

Start by creating a separate hanging file folder with a label for each of the major categories below.

o Bank Statementso Military Documentso Credit Card Statementso Mortgage Documentso Credit Score Reportso Personal Investment Statementso Home Improvementso Product Service Manualso Insurance Statements & Policieso Property Tax Statementso Legal Documentso Retirement Statementso Loan Statementso Social Security Benefit Statementso Medical/Pharmacy Receiptso Tax Returnso Miscellaneous Billso Vehicleso Miscellaneous Receipts

Once you’ve labeled your hanging file folders with these categories and any others you think are important, it’s time to create subcategories using the manila folders. Each manila folder will contain specific information within each major category.

Bank Statements

Inside this hanging file, you’ll want to create separate folders with labels like the following:
Checking Account(s), or one folder for each checking account
Money Market Account(s)
Savings Account(s)

Credit Card Statements

In this hanging file, you’ll want to file statements in folders with labels like the following:

Credit Card #1, or VISA 1234 if you have more than one VISA account
Credit Card #2, or Mastercard 1234 if you have more than one Mastercard account
And so on

Credit Score Reports

In this hanging file, you’ll want a separate folder for each of the three credit agencies:

Equifax
Experian
TransUnion

Home Improvements

In this hanging file, you’ll want to save all receipts that would be helpful for tax purposes should you ever sell your home. You could save them by year or by project, as follows:

2015, 2016, 2017, or
Screened porch, master bath, etc.

Insurance Statements & Policies

In this hanging file, you’ll want a folder for each type of policy; if this hanging file gets too large, you may have to create a separate hanging file:

Automobile Insurance
Dental Insurance
Disability Insurance
Employer’s Insurance
Health Insurance
Homeowner Insurance
Liability Insurance (aka Umbrella Insurance)
Life Insurance
Long-term Care Insurance

Legal Documents

In this hanging file, you’ll want to keep COPIES of your legal documents. The originals should be kept in a safe deposit box at your bank. Your attorney also may retain copies of these documents, which is also a good idea.

Will
Trust and Amendments
Health Care Directive
Powers of Attorney

Loan Statements

In this hanging file, you’ll want to have a file for each loan you have except your mortgage, as follows:

Auto Loan
Student Loan
HELOC
Personal Notes

Medical/Pharmacy Receipts

In this hanging file, you’ll want files for your receipts that may be helpful for tax purposes.

Miscellaneous Bills

In this hanging file, you’ll want a file for each bill. You may want to add a second hanging file to separate monthly bills from quarterly and annual bills.

Cable (Internet, Satellite)
Cellphone
City (Garbage, Water)
Daycare
Electric/Utilities
Health Club/Gym
Housekeeping
Phone
Rent
Yard Maintenance
And other bills that you may have

Miscellaneous Receipts

In this hanging file, you might want a folder for each month with which to file every-day receipts, like for gas, clothing, groceries, and so on. If you need to make a return, you can easily find the receipt, which you’ll need in most cases.

Military Documents

In this hanging file, you’ll want a folder for your important military records:

Discharge Papers
DD214
Fitness Reports
Letters of Promotion
Military Medical Records
And so on.

Mortgage Documents

In this hanging file, you’ll want to include all applications, contracts, financials, and statements associated with your home and mortgage company (that big folder of documents you received when you closed on your home).

Personal Investment Statements

In this hanging file, you’ll want a folder for monthly, quarterly and annual statements. You may want a folder for trade confirmations. If you have investments at different institutions, you may want a separate hanging file(s) labeled by institution:

Investment Account #1, Account #2, etc., or
Bank #1, Credit Union #1, Ameriprise Financial, etc.

Product Service Manuals

In this hanging file, you’ll want a folder for your most important product manuals (you may not need to retain the manual for your computer mouse, for example). Today nearly any manual you need can be found online and can be downloaded as a pdf file. This is more efficient than having the paper copies. Keeping the original manuals may be more convenient but may require more than one hanging file.

Baby Equipment
Computer
Electronics
Exercise Equipment
Furnace and Hot Water Heater
Kitchen Appliances
Lawnmower
Snowblower
Television
Washer/Dryer

Retirement Statements

In this hanging file, you’ll want a folder for each retirement account as follows:

IRA #1, IRA #2
Roth IRA
401(k)
Pensions
And so on

Social Security Benefit Statements

In this hanging file, you’ll just need one folder for your benefit statements, which you either receive automatically or have to request depending on your age.

Tax Returns

You’ll want a hanging file for each tax year. You need to retain your tax returns for seven years, so you’ll purge the oldest file once you’ve filed the current year tax return. Retain all supporting documents with your returns; you’ll need them should you ever be audited.

Vehicles

In this hanging file, you’ll want a folder for each car or other vehicle you may own. Retain all pertinent documents:

Car #1, Car #2
ATV
Camper
Snowmobile
Boat