How Long Do I Have To Hold On To Documents?

By Jon L. Ten Haagen, CFP

asktheexpert@longislandergroup.com

tenhaagen.com

 

Q: How long do I have to hold on to documents? 

 

I am sure that more than a couple of you have overstuffed closets and shoeboxes with “important” papers and old manuals – IRA statements, 401k reports, bank statements, cancelled checks, insurance policies, etc. So how long should you hold on to these items before you can hurl (or rather, shred) them?

Most people hold on to documents like they are gold, however, you most likely can get rid of them sooner than the 12th of never. In this article, I will review what to shred in the near future. In my next article, I’ll let you know what to keep and for how long.

 

Shred It!

If any statements have your personal information you should shred them – account number, social security number, address and phone number, etc.

• Pay stubs: The most recent statement shows all year-to-date information. Keep the most recent statement until your checkbook is balanced. If you are going for a mortgage, you will need 3-6 months of records.

• Credit card statements: Hold on to them for 3 months in case of a dispute on a charge.

• Monthly bills: Shred once the payments clear. For large purchase items, retain for insurance and proof of purchase reasons.

• Investment documents: Transactions in qualified plans (401k, IRA) do not need to be held because they are in a sheltered portfolio and will only be taxed on any distribution in the future. You can immediately (after you read them from cover to cover) throw out the prospectus and quarterly reports from companies of securities you own.

• Personal Credit Card Receipts: Shred them once received and reviewed. Especially look for small amounts you do not recognize – this could be a scam testing your cards. If you find charges you do not recognize, report them immediately, for scammers could be ready to charge large items if they see you do not pay attention.

• Generally, canceled checks: Once you receive the statement and have reviewed it, shred it.

• Bank statements: Once the checkbook has been balanced, you can shred them. Banks should have records back three months.

• ATM receipts: Shred once you have balanced your checkbook.

 

I want to thank my many financial associates (CPAs, attorneys, insurance experts, etc.) who helped me make this list. Happy shredding! And don’t forget to check back in two weeks for the list of what to keep


Disclaimer: This column is intended for informational purposes only and is not a replacement for professional services. The author and this newspaper are not responsible for the outcome of following this advice.

Huntington’s Jon L. Ten Haagen, CFP*, runs Ten Haagen Financial Services, Inc., a full-service independent financial planning firm – and now, he is here to answer your questions!

In this bi-monthly column, Ten Haagen will answer your financial questions and help you with his expert financial advice. Don’t be shy – our expert is here for you, so feel free to ask away!

E-mail your questions to asktheexpert@longislandergroup.com today, and let our expert help you!

*Ten Haagen is an Investment Advisor Representative offering securities and advisory services offered through Royal Alliance Associates, Inc., member of FINRA/SIPC, and a registered investment advisor. He is also an active community member, serving on several nonprofit boards and as executive officer of the Greater Huntington Boating Council.

** NEW OFFICE LOCATION: Due to a fire in the office building, the offices of Ten Haagen Financial Services, Inc. are now at 12 Bayview Ave., Northport.