Over the years we gather paper clippings, documents and bank statements. We try to discard some of this ever increasing pile. It is difficult knowing which financial and personal paperwork you need to keep or what to discard. To help you with this difficult task, here is a suggested list and timeline for keeping and/or shredding your important documents. Scan copies to be produced when needed for individuals who have limited storage space.
Documents which should be kept indefinitely—in a secure location:
- Birth/death certificates and Social Security cards
- Marriage Licenses and Divorce Decrees
- Pension plan documents
- Originals and/or copies of Wills, Trusts, Health Care Proxies/Living Wills and Powers of Attorney (attorney/executor should have copies) – Do NOT keep these documents in a Safe-deposit box as it may be sealed by the bank just when you need it.
- Military discharge papers
- Copies of burial deeds and plots
- Safe-deposit box inventory
- Copies of all tax returns
Suggested timeline for retaining documents:
- Supporting documents for tax return (7 years) - This is the recommended minimum period of time to retain, but it is advised that tax return copies should remain on file indefinitely. You can scan them to save storage space.
- Investment records and statements (7 years) - These are needed for tax filing. Keep for a minimum of 3 years, but you may want to keep for the same amount of time as your tax return to support claims.
- Credit card statements (45 days-7 years) - Keep up to seven years as it may be used for taxes, as proof of purchase or for insurance.
- Financial statements (1-5+ years) - Keep bank and financial statements for 5 years or longer. This is especially important if you apply for Medicaid which requires 5 years of financial information. Keep information on business expenses, home improvements, mortgage payments or major purchases. This information is useful for tax returns as well.
- Medical and dental records (1-5 years) - Keep for at least one year, but up to five years to be safe. Retain information about prescriptions, specific medical histories, health insurance information and contact information for your physician.
- Utility and phone bills (1 month-1 year) - Shred them after you have paid them, unless they contain tax-deductible expenses—keep them for a year if they can be used for business deductions.
- Insurance policies (until closed) - Keep as long as the policies remain in force.
- Mortgages and other home documents (for the full ownership period + 6 years) - Mortgages, deeds and home improvement documents should be kept on file for the length of ownership, plus six years after selling the home.
- Appliance manuals and warranties (as long as owned) - Keep on file for the length of ownership.
- Vehicle titles and loan documents (if owned) - Keep on file for the length of ownership.
- Pay stubs (until end of year) - There is no requirement for keeping pay stubs. Keep stubs for three months especially if you are applying for a loan. You may want to keep them for a year so you can compare against your W-2.
Be sure to carefully shred any information that has your personal details on it.
If our firm can help you get your legal house in order in the New Year, we are available to review your estate plan, your Will, Power of Attorney or medical directives.
Grimaldi & Yeung LLP: (718) 238-6960
Start 2019 with an updated legal plan.