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A Messy Person’s Guide to Organizing Their Financial Documents

The average American spends 2.5 days each year looking for something. Does this sound familiar? Would you be able to find all your financial documents quickly if you needed them for a loan or for any other reason?

Do you keep your financial documents stuffed in a drawer? You’re doing your finances a disservice.  Here’s how to get organized even if you’re a mess.

Gather All Your Documents

Before you start anything, you need to see what you have. Figure out all accounts you have and write them down. You can also add to an Excel spreadsheet with protected password.

Create a File System

After you see what you have, you can start arranging piles to create folders. Here are some suggestions for categories and examples of documents for each:

  • Bills due: keep all current bills here until paid
  • Financial management: bank account monthly statements, credit card information like account numbers, and any loan information on current loans like cars, student loans, and mortgage
  • Healthcare: medical records, receipts, and vaccination reports
  • Investments: IRAs, stocks, mutual funds, retirement plans, and any other retirement accounts
  • Home: any receipts for home updates, repairs, warranties, or large purchases like appliances
  • Education: transcripts, diplomas, or certifications
  • Employment: resume, evaluations, employee benefits, or any sample work
  • Taxes: past tax returns and tax documents like W2s or 1099s
  • Legal documents: birth certificates, passports, marriage certificates, divorce papers, power of attorney, living will, and real estate settlements
  • Insurance: health insurance, life insurance, and home/auto/renters policy declarations

Remember, these could vary based on your personal situation, and you may even need more folders. After you figure out what goes in each folder, you can separate the paperwork into piles such as bills to pay, read, file, and shred.

Organizing Your Filing System

You will want to make sure you have a visible spot for current documents like bills you need to pay. Add to a box by your computer or a bill organizer to avoid losing any paperwork.

You can then color coat your files with something like blue for current documents, red for education, yellow for legal documents, etc. Try custom labels to help you find information quickly.

How Long You Should Keep Documents

You should keep documents such as income tax returns, retirement statements, year-end bank statements, and major expense documentation for seven years. You can get rid of any pertaining documents when you get rid of your vehicle, home, or loan.

You will get new statements for your bank accounts, insurance, and retirement accounts. You can replace old statements with updated statements.

There are some documents you keep like your birth certificate and marriage license. You should store these in a safe area like a fire-proof box. When you are ready to get rid of financial documents, make sure you shred it to protect yourself from identity theft.

Keeping Your Financial Documents Organized

Now that you have your financial documents in a system, it’s important you keep this organization. Review all financial documents and folders yearly. Make sure your list of your accounts is accurate.

If you are looking to organize your personal finances even more and save money, take a peruse our site. You can find useful articles like the benefits of using a spending tracker or personal finance tips.