Have you seen your desk lately? Or is it buried under piles of bills, insurance statements, bank records, receipts and the user manual for that new smartphone?
You don’t have to live in such a cluttered — and flammable — situation. You just need a system for organizing and managing all that paper. Here’s how to create one:
1. Keep active information close at hand
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Paying a late fee because you forgot the Visa bill was due is both irritating and unnecessary. If you still get paper statements, keep a file called “Bills to Be Paid” and another one called “Bills That Have Been Paid.”
Store those files where they will be easily accessible, since you will be using them every month.
Bills aren’t the only obligations that need files of their own, though. Depending on your situation, you might have folders for:
- Health care
- Home repairs
- Tax paperwork
Knowing where these things are can save you a lot of fruitless searching.
To further reduce the chances of you forgetting about a bill, also set up recurring electronic reminders on your phone or computer. Or set up automatic payments for bills.
2. Scan it and store it
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Why keep all those pieces of paper? Suppose a fire destroys your home.
That’s why many people — including Money Talks News founder and CEO Stacy Johnson — scan paperwork and store it digitally. The originals can often then be shredded.
As Stacy explains his own filing system in the video above:
“I use a simple scanner and I digitize everything. I can find what I’m looking for in seconds and I keep it safe … in the cloud.”
Certain pieces of paper should never be destroyed, though. Among them are:
- Papers with raised seals (e.g., a birth certificate)
Scan all of these for backup, but keep the originals in a safe, fireproof location.
3. Corral your supporting documents
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If a new appliance or gadget gives you trouble or quits working entirely, you may need to check the owner’s manual or the warranty. Can you find them easily?
Once you do locate them, start a file called “manuals/warranties.” Again, you can scan and electronically store this paperwork. With manuals, you also have the option to download them from manufacturers’ websites and save them as PDF files, avoiding the need to scan them. Then, toss the paper copies.
Also be sure to toss or delete old manuals and warranties when you get rid of an appliance or gadget.
4. Stop getting paper statements
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There are two ways to reduce financial paper clutter:
- Manually digitize paperwork, such as by scanning.
- Bank and pay bills online, opting to receive electronic statements.
Most banks will allow you to set up an auto-pay system for recurring payments. Just make sure you have the funds in your account to cover the debit on the designated day. Then, after setting up a recurring payment, you generally don’t have to do anything.
This is not to say you should go without backups, though. Just save the bills or statements you want as PDF files.
5. Decide what goes where
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Do your child’s health records belong in a folder with yours? Or will they be filed separately? What about your auto insurance policy — in the insurance folder, or the automobile folder? Are your 401(k) statements filed under “retirement,” or with your will and life insurance papers?
Do what makes sense to you personally. Just make sure your spouse or partner knows where these things are too.
6. Clarify what you own
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If you lose a bunch of stuff due to fire or burglary, will you be able to collect their full value on your homeowners or renters insurance policy? Probably not, unless you’ve regularly updated your inventory of personal belongings and backed it up.
For step-by-step guidance on how to document your belongings and their value, check out “6 Tips for Making a Home Inventory Right Now.”
7. Get tough with taxes
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Money Talks News founder Stacy Johnson scans his tax forms and supporting documents for electronic storage and then shreds the originals.
Digital storage, offered by cloud-based services like Microsoft OneDrive and Google Drive, is so competitive that you needn’t pay a dime to store all the info you want, he says.
Do you have any great organizing tips that didn’t make this list? Share them by commenting below or on our Facebook page.
Ari Cetron contributed to this post.