How Long Should I Keep Important Documents?

We are frequently asked how long to keep documents. It’s an important question, and knowing the answer can help eliminate some of the paper clutter we all accumulate at home. According to Consumer Reports, the following is a good timeline to consider.

Documents to Keep for Less Than One Year

  • Keep ATM, bank deposit, and credit card receipts until you reconcile them, and then they can be shredded.

  • Keep insurance policies and investment statements until new ones arrive.

Documents to Keep for More Than a Year

  • Keep loan documents until the loan is paid off.

  • If you own a car, keep the title until the car is sold.

  • For investments, keep documents that will prove the cost basis of the investment. These can be destroyed when the asset is sold.

Documents to Keep for Seven Years

  • The IRS can request documentation to support your taxes for seven years, so tax returns and their supporting documents should be kept for that period.

Documents to Keep Forever

  • Birth and death certificates

  • Marriage and divorce decrees

  • Social Security cards

  • Military discharge papers

  • Estate planning documents

  • Life insurance policies

  • Defined benefit plan documents

  • The inventory of a safe-deposit box 

You should consider putting any essential paper documents in a fireproof box or safe. For documents that you keep forever, you may want to consider renting a safe-deposit box.

If you store your documents electronically, make sure that you have them backed up and that you have a strong password to access those files.

In either case, it’s vital that a trusted person knows where your important papers are and how to access them in case of your death or incapacity.

Remember that any important documents that contain personal information should be shredded when you discard them. A high-quality shredder is a great addition to your home. If you live near our office, we have a shredding service and are happy to take any documents that you need shredded.