Financial Clutter…What to keep and for how long

Keep for 1 year

  • Pay Stubs & Pension Stubs – Destroy once you have compared to your W-2 & annual Social Security statement
  • Utility Bills – Discard at year end unless you are deducting a home office, then keep with tax stuff for 3 years
  • Cancelled Checks/Bank Statements – Unless needed for tax purposes, then keep 3 years
  • Credit Card Statements – Unless needed for tax purposes, then keep 3 years
  • Investment Statements – Until annual statement comes

Keep for 3 years

  • Income Tax Returns and Supporting Documentation – IRS can audit for any reason for 3 years. If income is underdeclared, they can audit for 6 years, and there is no statute of limitations of no tax return is filed.
  • Medical Bills and Cancelled Insurance Policies
  • Records of Home Sales – for capital gains tax and use of exemption
  • Records of Security Sales in Taxable Investment Accounts – for capital gains tax
  • Annual Investment Statements

Keep for 7 years

  • Records of Satisfied Loans and Mortgages

Hold while active

  • Contracts
  • Insurance Documents
  • Stock/Bond Certificates & Basis Records
  • US Savings Bonds
  • Property Records
  • Records of Pensions & Retirement Plans
  • Home Improvement Records – hold for 3 years after property is sold for capital gains tax purposes

Keep until Warranty Expires

  • Sales Receipts and Warranty Cards

Keep Forever (in a very safe place)

  • Marriage Licenses
  • Birth Certificates
  • Adoption Records
  • Immigration Papers
  • Death Certificates
  • Military Discharge Papers
  • Divorce Decrees and Separation Agreements
  • Prenuptial Agreements
  • Wills & Codicils
  • Trusts & Amendments
  • Powers of Attorney
  • Health Care Documents

Maintain Annually (keep in a very safe place)

  • Balance Sheet
  • List of Accounts, Assets and Where They are Located
  • Online Access Listing with website, login & password