Suze Orman Says Keep These 6 Financial Documents For At Least A Year

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His advice is worth following.


Key points

  • It’s a good idea to sort your files from time to time.
  • There are certain financial documents that you should not destroy so quickly.
  • Pay stubs, bills, and brokerage statements are among the documents to hold on to.

I’m the type of person who hates clutter. And so I try to do what I can to remove it. That often means doing toy purges in my basement to clean out things my kids no longer play with, and sorting my shelves so I can donate novels I’ve finished and never find myself reading again.

Another area I try to declutter on a regular basis is my office. Since it’s my workspace, being surrounded by piles of documents tends to mess with my sanity.

But sometimes it can be hard to know which documents to keep and which to get rid of. To that end, financial guru Suze Orman has some advice. This is what she has to say.

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The documents you must keep for at least one year

There are certain financial documents that you may not need to hold on to for long. If you make a withdrawal at an ATM, for example, you probably don’t need a copy of that receipt.

On the other hand, Orman says these six items should be kept for a minimum of 12 months:

1. Pay stubs

You need them because they are a record of your earnings from work. And you’ll want to check them against your annual W-2 tax form and your Social Security income statement to make sure those documents are accurate.

2. Utility bills

It’s a good idea to keep records of utility bills in case you need them for tax purposes. If you’re self-employed, for example, you may be able to deduct a portion of your utility costs on your tax return. Also, if you are enrolling children in your school district for the first time, you will generally need a copy of a recent utility bill to prove that you live where you say you do.

3. Canceled checks

Orman thinks it’s smart to keep copies of canceled checks for at least a year. That way, if you have a discrepancy on your checking account statement, you’ll have an easier way to resolve it.

4. Credit card statements

It’s a good idea to keep copies of your credit card statements so you can refer to them for budgeting purposes. You may also need those statements if you are taking certain deductions on your tax return.

5. Bank statements

You may need your bank statements to calculate the tax deductions you wish to claim. Keeping yours can also help you keep track of your savings efforts.

6. Brokerage account statements

If you have a brokerage account, you will typically receive a quarterly statement summarizing your account balance and holdings. It’s a good idea to keep them for a year, until you receive your annual statement.

How to safely dispose of financial documents

While Orman says it’s a good idea to keep old documents for a year, once you’re done with them, you don’t want to just throw them away. All of the above documents may contain sensitive personal information, and if that information falls into the wrong hands, you could end up a victim of identity theft.

It’s a good idea to invest in a shredder so you can dispose of your documents as needed. Another option, of course, is to sign up for electronic versions of as many older documents as possible. That way, you’re less likely to lose them, and they’ll be easy to access when you need them.

Just as important, getting your documents electronically could help you eliminate physical clutter. And if you’re like me, that’s something you might need for your personal well-being.

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