Records Retention Guide

The following is a guide to what records should be kept and those you can trash.  I keep important financial documents in cloud storage, portable drives and hard copies.  Even if the original records are provided only on paper, they can be scanned and converted to a digital format.  Remember to shred any financial or personal documents once they are no longer needed.  A $30-$50 shredder will do the trick for individuals.  It is well worth the effort to avoid identity theft.

Keep Forever:

Income Tax Returns – Legal Records – Income Tax Payment Checks – Investment Trade Confirmations – Retirement and Pension Records

Keep for 6 years:

Supporting Documents for Tax Returns (the IRS can audit back 6 years if they suspect fraud or underreported income) – Medical Bills – Accident Reports and Claims – Wage Garnishments

Keep for 3 years:

Credit Card Statements – Medical Bills (if medical deduction used on taxes keep for 6 years) – Utility Records – Expired Insurance Policy

Keep for 1 year:

Bank Statements – Paycheck Stubs (reconcile with W-2) – Cancelled Checks – Monthly and Quarterly Mutual Fund and Retirement Contribution Statements (reconcile with year end statement)

Other Guidelines

  • Car Records (keep until the car is sold)
  • Depreciation Schedules (keep for 3 years after the tax life of the asset)
  • Insurance Policies (keep for the life of the policy)
  • Mortgages/Deeds/Leases (keep 6 years beyond agreement)
  • Property Records/Improvement Receipts (keep until property sold to calculate base)
  • Stock and Bond Records (keep for 6 years beyond selling)
  • Warranties (keep for life of product)
  • Bills (keep until payment is verified on the next bill)

Leave a Reply

Fill in your details below or click an icon to log in: Logo

You are commenting using your account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s