Now that all of your papers are divided into groups, it’s time for the fun part. Grab that recycling bag, because we’re going to fill it. As you go through each pile, I want you to have a copy of your “what to keep” list from Day 3 handy. The only things you should be keeping are the things on that list. As a refresher, a good starting point is to only keep:
- Tax Returns
- Supporting documents for tax returns
- Mortgage Closing Docs
- Files related to your home’s basis
- Files related to an ongoing health issue
- Major car repair documents
- If you plan on selling your car to a private party, these can prove your car was maintained and worth more.
- Pet health information
- Children’s schoolwork
It is reasonable to scan most of those items and only keep a digital copy. If your CPA has other ideas, confer with them before you begin recycling things. They may want paper copies of the current year’s documents, though our’s doesn’t. He just asks for a list of numbers for our deductions. A case can also be made for keeping a paper copy of any major home repairs you did, though if you scan them all to one file folder, it’s just as easy to access as a physical folder. I won’t fault you either way.
As you go through each item, toss it immediately if you don’t need it, and scan it immediately if you will need a copy. Here’s where the Scannable app can make short work of papers.
If you come across documents that need to be shredded, put them in a separate bag as you will be dealing with those tomorrow. Now that the recyclable is recycled and the shredding is in a bag, gather up your keeps into a neat pile. We’ll be dealing with it in 2 days!