With the New Year upon us, it is time to clear out old paperwork to make room for more. Are you dreading the idea of sorting through all those documents you’ve been meaning to shred for the past few years? You may be able to call a company to come and do the shredding, but you still need to sort through and decide what gets shredded and when. The prospect of beginning to shred documents can be overwhelming, but it doesn’t have to be. You just need to know what and when to shred which document to create a usable system and organize your office.
Beginning this daunting task is your first step to protecting yourself from identity theft. Take it slow, one file drawer or massive taunting stack of papers at a time. The most important qualifier for shredding is whether the document contains any of your personal information. But wait, don’t shred it yet! If it is tax related in any way, you need to hold onto that for a minimum of seven years, just in case the IRS comes knocking. To make it a little easier, The Federal Trade Commission (FTC) has a great chart on its website you can refer to when deciding if it is time to shred a document. It even tells you which documents should be locked up. Print it out and tape it to your shredder. I would say laminate it, but if you are that type of person, you probably don’t need to be reading this article. Using this chart will help you know which documents need to be held onto and for how long.
Whether organizing a home office or business, file documents not only by type (i.e. receipts, statements, pay stubs) but by how long they should be kept and by year. Use file cabinets and/or plastic bins to organize paperwork. File cabinets are great for recent documents that you still want access to during the current year. For tax documents that need to be held onto for seven years, use boxes or plastic bins you can store away. Each box or bin should be able to hold a year’s worth of documents. This way, at the end of each year, you know exactly what needs to be shredded. And remember, you are trying to protect yourself from identity theft, so lock them up.
Use your own judgement on some items. Don’t get shred crazy; some documents should be kept forever (i.e. vital records). If in doubt, keep it. I would disagree with a few of the items on the FTC chart; for instance, it recommends keeping bank statements for up to a year. Who prints out a bank statement or even receives one in the mail these days? Most banking is done online now and in most cases, you can get your bank statements going back at least a year. Also, keep in mind that the FTC list is geared toward the home office and personal documents. A business may need to keep certain papers for up to three years. It’s a good idea to consult your accountant if you aren’t sure about any business or tax related documents.
Once you get yourself caught up and feeling 10 pounds lighter, get a small office shredder or locked bin that you can easily shred on a daily/ weekly basis. Make shredding a habit, like lunch. You have to eat and you have to shred. QCBN
Danielle Rickert is the owner of Sir Speedy in Prescott, Arizona. To schedule on-site document shredding call Sir Speedy at 928-776-4332.