How long do you keep old records???

[karolyp]

I need help!!! My file cabinet is about to burst as I have so many old records. Years of Bank statements, water bills, credit card bills, tax information, school records...I have it all!!!

I want to start purging but I don't know where to starts so I'm wondering, how many years of records should I keep on hand and what should I throw away? Any suggestions?

TIA!!!

[tny915]

I got this from an article in Real Simple years ago and found it very helpful. That said, I'm still a packrat so I do save quite a bit more than this list, but I've found that these are very good guidelines.
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This list will tell you at a glance which financial records you should retain and which ones you can dump.

Toss Every Month

-ATM And bank-deposit slips, after you've recorded the amounts in your check register and checked them against your monthly bank statement.
-Credit-card receipts, after you've checked to make sure the item appears correctly on your monthly statement.
-Sales receipts for minor purchases, after you've satisfactorily used the item and if it has no warranty.

Toss After One Year

-Monthly bank and credit-card Statement (if you don't itemize deductions).
-Monthly or quarterly brokerage and mutual-fund statements, after you've reconciled them with your year-end summary.
-Monthly mortgage statements, as long as your year-end statement clearly shows the total amount you've paid in interest and property taxes over the course of the year.
-Phone and utility bills (as long as you don't have a home office, use your phone for business calls, or anticipate any need to prove long-term residency).
-Paycheck stubs, after you've reconciled them with your annual W-2 or 1099 forms.

Retain for Seven Years

-W-2 AND 1099 forms.
-Year-end statements from credit-card companies.
-Phone and utility bills (only if you deduct any portion for business expenses, have more than one home, or have moved within the past few years).
-Canceled checks and receipts/statements for: annual mortgage interest and property taxes, deductible business expenses, child-care bills, out-of-pocket medical costs, or any other tax-deductible expense.

Keep Indefinitely

-Your annual tax returns. Your year-end summaries from financial-services companies.
-Confirmation slips that list the purchase price of any investments you own.
-Home-improvment records.
-Receipts for major purchases. (any item whose replacement cost exceeds the deductible on your homeowners' or renters' insurance policy).
-Benficiary designations.

[KrisM]

Apparently, we keep everything forever, including receipts. It's an arguement that I always seem to lose. I want to shred, shred, shred! The PPs post sounds good to me.

[karolyp]

Wow...thanks for the great list. It's really helpful and exactly what I needed!

Thanks again!!

[katerinasmom]

"Toss After One Year

-Monthly bank and credit-card Statement (if you don't itemize
deductions).
-Monthly or quarterly brokerage and mutual-fund statements,
after you've reconciled them with your year-end summary."

I disagree with the above statement. As a trust and estates attorney, I recommend to my clients that they retain three years worth of banking and investment account statements. I know that people don't like to think about these things but, when you die, if the IRS audits your estate they will usually ask to see three years worth of banking and investment statements. Therefore, it would save your estate a lot of time and expense if you retained these things.