One common demoninator in most homes is an overwhelming amount of paper. We tend to keep all sorts of things, just in case! - notes from school, bills, receipts, newsletters. We might need that information later so we hold on to it.
Lately I've had several people ask me how to handle this situation. I have found a great resource for suggestions on how long to keep certain financial paperwork such as bills, taxes and receipts. Bankrate.com has compiled a fairly comprehensive list that you might find helpful in guiding the purging of your files. http://www.bankrate.com/finance/personal-finance/how-long-to-keep-financial-records.aspx .
Of course, if you are unsure, please contact your financial or tax advisor, as I am neither of those!
Have fun filing!
Have you filed your taxes yet? Are your files a mess? I think the reason most people hate tax time (other than having to pay taxes in the first place) is having to find all the necessary paper work needed to file your return.
Here's a couple of hints that might make things easier.
1) If you don't e-file, do it NOW! It is so much easier when the computer asks you the questions and does the math for you. Personally, my husband and I use Turbo Tax, but there are a lot of other software packages out there. Even if you are computer-challenged, you should be able to figure it out! (If you are using Facebook, I have faith you can do your taxes electronically too!). It also saves you money to have your refund (if you are so lucky), direct deposited into your checking or savings account. What a joyous surprise to wake up one morning and have that "extra" money in your account!
2) Make a Taxes file for each year. Every make a folder that says Taxes 2010, or whatever year it is. As the year goes along you can throw necessary paperwork into it, tax-deductible receipts, W-2s, 1090s, etc. Then when tax time does come around, you can just pull out that file and using your computerized tax program to see what else you may need to track down. Once you've finished with your return, you can place a copy of your return and all ancillary paperwork back in the Taxes 2010 file and place it in your filing cabinet. (If you are wondering how long to keep your tax files, you can reference my previous note - PAPER - What to Keep and For How Long?)
3) How to improve your files for next year? Don't be overwhelmed by a pile of paper on your desk, counter, filing cabinet... Take it in baby steps. If your paper is in a couple of tremendous heap, try sorting through it 1 inch at a time. If your files are bulging at the seams, go through them one or two at a time. Then take a break. Your files didn't become a mess overnight, so don't expect them to be perfect overnight. Patience will pay off in the long run.
Happy filing!!
