Excerpted from Personal Record Keeping—Prevent Identity Theft
by Steven Hastert
Learn how to prevent identity theft with the article below. Personal record keeping is imperative to ensure the prevention of identity theft. Learn how to improve your personal record keeping and systems for personal record management . What to do with all those personal receipts, documents and tax returns? Let this article on personal record management help you.
Is your file cabinet bulging with another year’s worth of tax documents? Are you keeping every single bill, tax return, insurance invoice, medical documentation, contract and even the warranty for that 15-year-old coffee maker you don’t even own anymore? If you answered, “yes” to any of these questions then you are not alone. Many people are not sure how long to retain their financial records.
With the threat of identity theft coming largely from paper documents it is good practice is to shred all the records you should no longer retain, especially those with your personal information. Expired documents can pose a threat to your financial health and may not provide you with any useful information.
At least once a year you should go through your files and shred everything that is no longer needed. With this volume of shredding you should consider using a shredding service. A personal shredding service like Express Destruction can save you from wasting a day burning up your personal shredder and is very affordable.
When it comes to personal records retention guidelines, there aren’t any hard and fast rules but these are some basic guidelines for the retention of your personal records.
Tax Returns. The general rule for tax records is to retain them for seven years. When you file the new return shred the newly expired one. The IRS has 3 years to audit you from the date you file your taxes and it is up to you to have all of the backup information that went into the preparation of your returns.
Bank Statements. The only reason to keep bank statements is if you are thinking about applying for a mortgage and that would be a three-month history. Otherwise, the bank has all of your records if a need arises.
ATM Receipts. Keep these until you balance your bank statement and then shred them.
Credit Card Statements. It is recommended that you keep three months on hand.