I’m one of those people that starts my taxes on January 1st. The earlier that I can get it done, the better.
We almost always have a significant refund coming our way, so there’s that motivation. (Spare me the lecture on lending the government my money for free. We like it this way.)
A huge hurdle in the tax paperwork prep is having an organized system for ALL the papers.
I got the main idea for the way we organize our home filing system from A Bowl Full of Lemons. I started with her main ideas and tweaked it for what we have and what we need.
Sidenote: This is a great way to approach the blogosphere in general. View others’ content not as a standard or something to be carbon copied, but rather as a starting off point to be reworked for you.
Home Filing System Game-Changers
1 – Monthly Folders for Paid Bills
We used to have a folder for each account or bill (ex: Mortgage, cable, electric, etc.).
This meant that at the beginning of each month, I would go through each account folder and throw away the bill in that folder from twelve months ago.
Can you say tedious?
Now, at the beginning of the month, I pull out that month’s folder and shred bills from twelve months ago and start fresh for the current year.
When a bill gets paid, that bill is put in that month’s folder.
It’s easier for me to grab one folder and put all the paid bills in there vs filing each individual bill in a different folder.
2 – Color Coded Folders
As you can see, I still used the plain folders that I already had because it seemed wasteful to me to purchase all new folders for everything when these worked fine.
But, each of the manila folders are in categories, which are marked in the colored, tabbed hanging files.
Color coding these categories gives me a quick, at-a-glance way to see where stuff is.
GREEN – BILLS & ACCOUNTS
- Folder for each month for paid bills
- Folder for each billing account
- Folder for each credit card account
- Folder for each loan account
- Folder for each account/loan that has been paid off (I wish there were many more of these folders……)
RED – INCOME & TAXES
- Folder for each employer
- Folder for each retirement account
- Folder for current year tax deduction receipts
- Folder containing previous year’s tax information
BLUE – AUTOMOBILE, HOME & INSURANCE
- Folder for each vehicle
- Folder for auto insurance policies
- Folder for each house we’ve owned
- Folder for homeowner’s insurance policy
- Folder for each life insurance policy
- Folder for each warranty account
RED – HEALTH
- Folder for health insurance policy
- Folder for each person’s health records
I would LOVE to have five different colors (for five different categories), but the box of three colors was half of the price, so I made due. #storyofmylife
3 – Know What to Keep & What to Throw
Generally, we defer to not keeping things. Go with the view that most information, when necessary, can be accessed online or by calling a representative/agent.
For example, Health Insurance benefit summaries. They can be longer than some novels. Why store them? We always end up calling our insurance agent for clarification about what is and what isn’t covered even when we dig out and read the gargantuan summaries.
What documents do you struggle to know what to keep and what to throw?
And, because I will get asked about storing tax paperwork, tax information from 2+ years ago is stored elsewhere in a safe. I keep the previous two years in our desk so that I can access it easily and quickly.
Our desk system is from Ikea. Each of the sides are the Alex units with drop file storage and the middle drawers are the Alex unit on casters (or, in our case, not on casters). The desktop is the Linnmon Tabletop.
I would love to have the Pottery Barn lateral filing system that A Bowl Full of Lemons uses, but our Ikea option was a fraction of the cost and it gives us loads of works space.
The file drawer on the right side (underneath the computer) houses files for Bills, Accounts, Incomes & Taxes (Green & Red). The file drawer on the left side houses Automobile, Home, Insurance & Health records. These files don’t need to be accessed often and more for storage and reference than frequent use.
It’s 2018, so I pay most of our bills at our computer. In deciding which files would go where, I chose the files that had anything to do with bill paying to be in the drawer nearest to the computer. The other files went way, way far away – to the other end of the desk.
What’s the hardest part of paper storage for you? I’m curious to know if anyone has gone fully digital. Is that possible?