Organizing your filing – part 1

A lot of people, it seems, have a hard time knowing how to organize their filing systems at home.  A big problem is that there are different theories about what you should toss and what you should keep and for how long.  Some people recommend one thing and other people recommend another and it’s nearly impossible to really know which one is the One To Follow.  So people tend to either toss it all or keep it all or find some place on the spectrum in between.  And probably always feel like they’re doing it wrong.

I’m not an accountant and I’m not incredibly knowledgeable about all the different financial problems and circumstances that can happen with home finances and paperwork, but let me tell you about some of the things that I found to be useful and how I’ve organized it to work for me.  This is going to be a multi-post series because it’s a big, complicated concept.  But, hopefully, I’ll be able to keep it from being too boring and maybe even share some ideas that you’ll be able to use in your own home.

Now, let me say this first:  Everybody faces their finances differently and handles their organizing differently.  The system I’m going to describe works well for me, but it might need some major tweaking to work for you.  I’ll try to include options as I go through this so you can see other options that might work better for you.  But keep in mind that this is just an option and you can take from it what you like and leave the rest.  (And I did warn you ahead of time, so don’t get upset at me if you decide later on that you wish you hadn’t thrown away that thingamabob.)

In my opinion, after knowing what to keep and what to toss, the biggest problem with establishing and maintaining a filing system is that filing is boring.  It’s dull.  No one likes to file.  Some of us like to have a wonderful filing system, but no one likes to sit there and put papers into folders.  It’s DULL.  So it’s important to find a way to make it so you’ll actually sit down and file the papers that you need to keep.  For me, this means having a beautiful filing cabinet that’s organized in a way that works well for me and is located right in my office next to a comfortable chair.  Once I get a pile of things to file, I’ll sit on my comfortable chair, work my way through it, and be done.  But if I had to stand there and file things in a place that doesn’t make me as happy as my office, I doubt I’d ever do it.  I had to find a place that was comfortable and peaceful for me to keep my filing cabinet so I’d actually sit down and take care of things.

Next, for the most part, there are three different expiration dates for papers – 1 year, 7 years, and lifetime.  Things like bills, if you decide to keep them (and I’ll get to that soon-ish), you should keep for a year.  If the Auditors ever come a-calling, to my understanding, they’re interested in your finances back as far as 5-7 years, but, generally, not any further than that.  And then things like birth certificates, social security cards, and those things you should keep for the lifetime of whoever they’re for, and things like car titles and house deeds and major electronics receipts and paperwork, you should keep for the lifetime of the item.

And, of course, if there are items of significant sentimental value, you should feel comfortable to keep those as well – just so long as you understand the line between keeping sentimental items and hoarding everything.  There’s a huge line there and it crosses into mental illness so if you think you might have a hoarding problem, please seek psychological help.

Okay, I want to keep these from getting too long so that’s where I’m going to end it for today.  But let’s recap quickly:

  • There are different theories about how to handle filing systems, but I’m going to try to sort through them and give you a straight-forward way to handle the whole thing.
  • You should try to find a place to keep your filing that is comfortable and where you will actually sit (or stand) and take care of it.
  • Generally, you should keep papers for 1 year, 7 years, or a lifetime.  We’ll get into what falls into what category in the following posts.

Your homework for today is to think about where you keep your current files (if you have any) or where you’d like to establish your filing and decide if that’s actually a place where you will go to take care of this.  If it isn’t, then try to brainstorm places where you’d feel more comfortable.  Don’t worry if the answer is “In front of the TV” because I can work with that!  Just hang onto your boots!  We’re going to get filing!