How many of you come to the end of the year with a bundle of paper you need to keep to prepare your taxes or because you have to be reimbursed for medical expenses or for who knows what reason? How many of you just find that at the end of the year you have piles of Stuff you can’t remember having a reason to keep? How many start the year with plans to do better and then it all falls apart? Every year I find myself going through a large personal safe of paperwork. I’ve been good about filing it away but I still have way more than I want or need. I also find myself starting a new year with plans to create a better way to file things. It never seems to work like I want.
This year I am recommending creating e-files for those papers that we need to keep. I’m also recommending e-files for keeping things for the new year too. Here is how I plan to do it.
The Old Year.Â
For every tax file I need to keep I will create a year file under taxes in Dropbox. As a year becomes redundant I will just delete the file. I will keep no paper copies. I can easily print them out if needed.
I will create a file for every other item of paperwork I need to retain. Once I no longer need something I can delete it. Probably an end of year task.Â
All paperwork no longer needed will be shredded and disposed of.Â
The New Year
Create a Medical File that includes sub files for each doctor, hospital, ancillary office. Mom sees an inordinate amount of doctors along with having numerous tests and procedures. I need to keep track of the bills, results, etc. I can match bills with payments, maintain a file of results of tests and procedures, and at the end of the year use it all to create the medical deduction if needed for taxes.
Create a Financial file. This will include a year’s worth of bank statements. Again this will keep this information available for tax purposes.Â
Create an Automobile file. This file will contain copies of all work done on a vehicle, the insurance policy and any other pertinent paperwork for the car.Â
Create a Home file. This will contain the insurance policy, repair paperwork, etc.Â
Just looking at these two lists creates a calmness in my heart because I know I can maintain all of this with a little work between the holidays. I hope this gives you some ideas of ways to cut down on the paperwork clutter in your home.Â
Does anyone else have files you would want to create?
Hi Deb J, I like paper LOL so I have paper files for all of the categories. I try to keep them weeded out enough that it isn’t a hardship to file things. I think part of why I like paper is my memory being so bad. I can remember that all the financial stuff is in a certain drawer, all the medical & insurance in another drawer, etc. If I didn’t have that cue, I’m not sure I could locate things 🙂 But you had a lot of good suggestions for people who like to do things online 🙂 <3<3<3
Peggy, I can understand you liking paper. I have been that way for years. I have just recently started going to online because of the space idea and also because if there were a fire I could still reach all of my files from any computer connected to the internet.
Coincidently I nearly bought a fireproof document box recently and then realised that storing these documents online would be a much better backup for such events and prevent one more piece of clutter being purchased.
Sally, you were smart to not get one.
Luckily mine is pretty well organized…especially since our income tax is being audited this year for 2013. This is the third time we’ve been audited…a real pain…you have to send in receipts for everything you used as a deduction. I’ve always had everything available so…no problem except the huge amount of time it takes. However, I think in my decluttering zeal this year I got rid of an insurance file that contained receipts for our prescriptions for that year. Except for that, I already have everything copied and ready to mail. Tomorrow I will call the insurance company and see if they can provide it. Hope so!
So glad yours is well organized Deanna. Being audited is such a pain. I’m glad we no longer have to file due to our income being all social security.
Hi, Deb. I am not so sure about uploading documents, especially tax or medical related ones to online storage for security reasons. I would certainly not recommend this idea to people who are not aware of internet / computer security risks and how to protect themselves from hacking.
Noriko, I understande the idea of not putting financial info in online storage. Yet, I have found that it is as secure as banks and credit card companies anymore. So I am putting it all out there.
Storing documents in digital format is an excellent way to keep paperwork down. Online storage is very risky though. Dropbox has admitted accounts were breached in 2014 and that they were hacked in 2012. If you do have to use online storage services it’s a good idea to encrypt your files before you upload them. That way if/when your account is compromised anyone who tries to view your files will only see gobbledygook.
Deb – I actually already do this! I actually scan each receipt and digitally file them by name, month, day in the 2015 file. My main motive is for when my husband asks where did all the money go? it is easy to match up from the bank statement. I don’t do the supermarket receipts though as there are just too many of them, but I’m sure that will change as the kids leave home.
My other motive is that I’ve been compiling a ‘household inventory’ and put a copy of the relevant receipts on that folder too.
I don’t put tax info in my drop box, simply because in New Zealand our tax system seems a lot easier that yours, and folks here can create a log-in to Inland Revenue and all the information is stored on their system electronically.
Moni, it is great you already do this. For me the tax issue is that you have to keep all of the pertinent info with the tax forms. It can be a big amount of stuff. I am pondering whether to actually put the tax info online because I think we are past the place where we have to hang onto tax years where I was making a lot of money or where we sold the house. So I might be able to just hang on to a few pieces of paper for the 7 years we have to keep.
Deb J – did you know that you can have scan documents containing many-many pages? Of course, the printer has to have the capability but copy shops would definitely have the right equipment. My work scanner can create a pdf with up to 100 pages in the document (I think). If I was going to get a copy shop to scan a multi-page document onto a flash drive for me, I would probably photocopy as many receipts etc onto one page, so that it was all neat and convenient for them to run thru the paper feeder in the shop. That could be an option for such paper work.
Our Inland Revenue passed an Act many many years ago that digital copies were an acceptable method of documentation, we are also supposed to keep tax documents 7 years so this has made it a lot easier. Our personal tax system is very very simple here, so most folks don’t need to file a return if they do not wish to, and it can be done online on IRD’s website or if they want to use an agent, most use a phone app to apply for their return.
I have kept documents of house sales filed digitally, our business accountant prefers everything in digital form too as we use Xero software and the documents are filed against the transaction on the master-server. Every day receipts and bills, we digitally file here at our office/drop box.
I have a friend who this system would not work for her, she has a box she keeps her receipts etc in and it works for her, I feel the population splits into pilers and filers. I was absolutely buzzed when I was a young girl and saw a file room for the first time – hence how I ended up in Records and Archives for my early work career.
I will add however, that when I need to recall dates or time ranges, I have been known to say, wasn’t that around the time that we got the lawnmower fixed, or we were out shopping for X around that time and then I reference my file.
Moni, Yes I did know that you could scan multiple pages of a document. My printer does not provide for that unfortunately. I am looking at other ways to do that. Thanks for the info.
I wish our tax system was as simple as your is. Ours is ridiculous. I wish they would pass a flat tax that everyone has to pay and forget it. I think everyone would be just as happy to do that when they learned it would take less taxes from them than they pay now. Unfortunately, that would mean a lot of IRS people would lose their jobs.
It sounds like you have all your files well in hand and digital. I think that is wonderful.
Hi,
Interesting system, Deb J. In our country, we still need paper receipts for tax returns and have to keep these for 7 years. As primary house sell/buy is not taxed, we don’t have to keep that info for old properties. Our tax records are more than half our paper files. It will be nice when they allow us to keep ecopies.
Idgy – ring your Inland Revenue one day, you probably are allowed to digitally file. Whether it is paper or scanned either way, we have to keep 7 years.
Moni,
My daughter and I love how people in many countries say they will “ring you”. Don’t know why we in the states, “call”.
After our first trip to London, we started saying that we are going “on holiday” instead of “vacation”. Sounds so much better.
Kimberley – call actually makes more sense, Im not even sure how ‘ring’ fits into it, now that I think about it.
We have another reaponse in NZ which goes ‘yeah, nah,’ instead of giving either a yes or no but really doesnt make make any sense at all except we know what it means.
Hi Moni. I believe the original term “give you a ring” came about because telephones used to actually ring. Now they quack, whistle, or play the cannon fire from the William Tell Overture. So, yes, “call” works.
In Canada (I think Idgy is a Canuck too) we can e-file our taxes but they want paper records in case they choose to audit. That way the burden of handling all that paper is ours, not theirs. I am finally able to toss the tax receipts from building our LAST house just now as I am about to file for the tax rebate on building THIS house. And yes, they want paper.
I don’t think I mind as my beloved desktop compute died today and EVERYTHING was it in. Hadn’t quite got around to backing it up but at least I still have all that paper.
Moni,
Love that expression too!
Idgy, sorry to hear you can’t file digitally. For us we can file digitally. I also keep my old docs digitally now. I can always print things out if I need to.
I checked our tax office. We may be able to save in eformat, but there is a very long list of criteria to do so.
Idgy, I guess for you then it comes down to whether going digital is worth the time. In some cases it isn’t.
Deb J.,
Congrats on making the plunge. I have to agree with Peggy. While I don’t love paper, I am a pen to paper kind of gal.
Other than the normal documents, some of which must be retained forever, I keep our household documents filed in one drawer of my desk in labeled hanging files. State and Federal income taxes are kept in a small box. When the current year is filed, the oldest year is shredded. Works for me and doesn’t take up much space.
Kimberley, I used to be a paper and pen type too. Lately, I am finding it is a pain to keep it all as it seems to grow. I used to have a drawer to keep things in but we had people reporting having their houses broken into with the “burglers” taking social security into, etc. That made me decide to go digital.
Deb J., you have a point. Financial information is much more lucrative to a burglar than jewelry etc.
I’m going off topic here a little – talking of ringing out out the old and welcoming in the new….. is anyone planning any special challenges for the New Year ie buy nothing new for the year or ?????
Hi Moni,
I found myself replacing perfectly good clothing several times this year. To ease the wallet, last month I started a buy no new clothes for myself until 2017 challenge. I am allowed to replace an article of clothing that becomes unwearable. I can buy clothes for the kids when they outgrow them, but need to look for second hand options first. I am surprised how hard the first few weeks were. I hope this will teach me to be more content with what I have.
Moni and Idgy of the North,
I like the “use it up, wear it out, make do or do without” theme.
Kimberley – or in other words, a 365 Less Things theme
Hi Moni,
I think this New Year question is a great topic for a whole post of its own 🙂
I don’t know if this is just for the new year, but I am thinking on the cleaning products, how I need to scrutinize those that are seldom or never used. Just today I left a carpet/pet odor product on my neighbors step (she has cat & dog). Texted her to say if she doesn’t want or need, okay to chuck out. I also tossed some window cleaner that was dehydrated, not working as it used to because it sat too long in our garage. Found 2 packages of dried “wipes” and tossed those. I don’t know why this is so hard for me!
I left a small box of auto items for my husband to look through. He doesn’t get too excited about decluttering but once he gets started, he’s brutal haha! Mucked out my car while I was at it 🙂
Regarding clothing, I don’t buy much anyway other than socks & undies. However, for Christmas I am buying myself a fluffy “bed jacket” type thing to replace my long robe. The robe is still in good condition but I noticed that the length bothers me so that I don’t wear it. I am also buying a new pair of stone/khaki pants (for myself for Christmas) because the waistband of my old pair is getting frayed. Once I receive these new items, the old ones will go.
Moni, I don’t have any challenges for the New Year. I will be buying a few things because when we move I will need some essentials we don’t have 2 of. Other than that, I plan to try to keep things from coming in. I am also going to switch to more earth friendly cleaning products so am using up what I have.
I want to give that some thought Moni. This year my husband and I had a no spend month. We only bought groceries, medication and petrol. We actually limited our groceries too and used up the pantry and freezer items. We saved quite a bit of money that month. I would like to increase the number of times we do that next year to maybe 3 times in 2016.
I have a friend who calls this month NO!-vember in preparation for the Christmas holidays. It mostly means no extra spending, no eating out, ect. I think it’s a great idea.
If you only keep online files, how do you digitize them from paper copies to digital copies? Do you take a photo with your phone and then throw out the hard/paper copy?
Victoria, I scan mine onto my computer. If you don’t have a scanner on your printer you can have them scanned at a copy shop.
Hi, Deb J. You’ve done a great job in establishing a system that works for you.
Whether the files are paper or digital ones, I’ve found that the following points work for me:
(1) Being selective about what I keep.
(2) Creating a simple and organized system.
(3) Using that system.
(4) Maintaining the system regularly and removing any contents as they become unnecessary.
Nicole V, you have some good points. Whether digital or paper, we need to keep on top of our files and keep them organized.
Nicole and Deb J, this is off subject…I’m still playing the “declutter with friends” game, but I don’t think my posts are showing up. I posted a decluttered item every day during the Thanksgiving holiday, but in the middle mine began to say “awaiting moderation” and it appeared the next person who posted skipped mine. I addressed this in the game posts but didn’t get a response. So then I sent a message to Colleen, but still didn’t get a response. Wondering if one of you has a way to find out what’s happening??? IM STILL IN THE GAME!!!!
Deanna, I’m sorry to say that only Colleen can take care of this problem. I will email her to see if I get a response.
Thank you, Deb J.
Your “Happy Thanksgiving” post was the last post that I remember seeing, Deanna. I had no idea you were still playing and that your posts were not showing up. Like Deb J said, only Colleen can take care of this problem. I’m sure she’ll do so as soon as she can.
Hi Deb J, You have mentioned how much medical type info you have to manage, so I think that is a big reason why it is good for you to go digital. Medical issues do create a ton of paperwork! My household is fortunate to not have that issue yet, so maybe that is why I’m so content with my current system. I have been thinking about going paperless for the regular bills once we get the debts paid off. I like to pay whatever we can on those each month, rather than just the “required” amount, so I don’t want them automated. I don’t want a half & half system either because that would really mess with my brain LOL
Peggy, yes having a lot of medical bills does create an pile of paperwork. It is better to pay off more than required on your bills each month. we hope to have that done soon except for the medical bills and then we will be even more free.
Hi Deb J, Wasn’t today your moms hand/wrist surgery? How did things go?
Peggy, thanks for asking. Everything went well. No pain and sassy as ever.