Maybe there are some documents you still receive as paper. How long do you keep them before you can watch them turn into so many bits of shredder confetti?
Tax return and supporting documents
The rule of thumb is seven years. Unless you talk to a CPA, they’ll say forever. This is likely because the IRS can audit you as far back as they want if they suspect fraud. Guess who decides if there’s fraud? Not you.
The retention timeframe for the following categories is with the understanding that none of these are supporting documents for your tax return or are business-related.
One year. And I’m being generous with that timeframe. I find it easier to have an annual purge of old documents rather than every three months.
Really, people keep those? Officially, you need to keep them until you balance your checkbook. Because people still totally do that.
Seriously, no one gets canceled checks anymore. You’re lucky if your bank statement has check copy images. Unless you have to pay an extra fee for it, that’s not lucky.
Mobile deposited checks
Five banking days. Until the check clears. A month. Or stick it in a file, then clear it out with your annual paperwork purge.
Credit card statements and receipts
Again, one year on the statements. Mainly so you only need an annual purge and not every three months. For receipts, maybe let them sit crumbled at the bottom of your purse for a month before tossing them.
An exception for the receipts is if there is a likelihood that you will need to return something or if it was a major purchase (like appliances, furniture, jewelry, etc.)
Wow! Do you work for a company that still gives you a paper paystub? That’s probably why the payroll lady gives you a dirty look whenever she sees you.
Stick them in a file and toss them in your annual purge.
Medical bills and explanation of benefits
I’ve seen PhDs weep after attempting to decipher medical bills and explanations of benefits. So, while the impulse is to remove the reminders of your failing body and eventual mortality, you should hang on to those documents. Three years minimum, five years if you had major medical procedures or have a chronic condition. If a provider suddenly sends you a bill a year after the service date, having the paperwork in your files saves you the 30-minute hold time when calling the insurance company to get copies.
Short answer: Keep the insurance policy while the policy is in force.
Property insurance policies like auto and homeowners are often written for six months to a year. You can purge the old one once you get the new policy unless you have an open claim.
Medical insurance is generally written for a year. Those old policy documents you may want to keep the same amount of time as your medical bills. Most people have at least one claim on their health insurance each year, and the benefits can change with each new policy term.
You’ve paid off that obnoxious loan. Now you want to have a bonfire to burn the records to ash. Wait! You should keep those records a least until the loan drops off your credit report. So wait seven to ten years. Or for more instant gratification, burn the documents in effigy on that great big bonfire.
Either keep the documents until the warranty expires. Or keep for as long as you own the item under warranty – if nothing else to remind you that it’s no longer under warranty.
Back in the olden days (aka pre-2011), you needed to keep all your statements to prove the purchase price (aka cost basis) of a stock, bond, etc., held in a taxable investment account. But since about 2011, brokerage firms have been required to track the cost basis for securities purchased after 2011. So your most recent statement will have the up-to-date cost basis for any securities purchased after 2011. But if you have stocks that you bought before 2011, you need those old statements.
You may have a mix of very old statements and the most recent year’s worth of statements in your files.
Home purchase documents and capital improvements
You finally moved out of that home after 15 years. You can finally pitch the banker’s box full of receipts for capital improvements to the home. Don’t start piling the logs for the bonfire yet. Those purchase documents and capital improvements may be proof that you didn’t need to pay capital gains on the sale of your home. So technically a tax item. Seven years after the home is sold is a good round number to keep those documents. Just one more box for the movers.
Auto purchase and maintenance records
If you’re not an engineer, you may not feel compelled to keep receipts for every oil change your ten-year-old car’s ever had. But certainly, any major maintenance or repair should be stuffed in a file waiting for any questions that pop up while you own that vehicle.
And keep the purchase documents and auto title for as long as you own that vehicle.
Here is a list of documents you should keep until you die. Then they’re someone else’s problem:
Birth certificates, death certificates, social security cards, adoption paperwork, citizenship papers, educational transcripts, professional license records, medical records, military records, marriage licenses, divorce decrees
Keep these documents until you replace them with a newer version
Wills, Trusts, Powers of Attorney, and Medical Directives
This is not an exhaustive or definitive list. If your CPA, attorney, or doctor tells you otherwise, please listen to them. You pay them money to give you advice.