Tips On How On How Long You Should Keep Documents

By Jon L. Ten Haagen, CFP


Last time, I reviewed a list of documents that you should shred sooner you might think – freeing up your closets for whatever you’d like. That list included pay stubs, credit card statements, monthly bills investment documents, personal credit receipts, banks statements and ATM receipts.

Here, let me review with you what to keep and for how long.

·        Medical bills, prescriptions, insurance statements and hospital bills: Maintain for five years from the date the services were performed. I would shred these because of personal information.

·         Utility bills: If you are writing them off for business keep for a year. Otherwise keep for three months.

·         Satisfied loans – Hold onto for seven years.

·         Permanent documentation: Birth certificates, education records, professional license records, death certificates, adoption paperwork, divorce decrees, military records. These are documents you NEVER discard.

·         Charitable contributions: Donation receipts and acknowledgement letters should be held until you do your yearly tax fillings.

·         Home repairs: Keep a log or journal as long as you own the property so you can show the cost of improvements upon sale. Keep warranty paperwork until one year after the warranty ends.

·         401k (403b, 457) statements: Review statements when they come in against the last statement received (i.e. your June statement vs. the May one) and then hold on to the year-end statement for tax purposed. Keep the annual statements until the account is closed out.

·         Non-deductible IRA contributions: Maintain until the account funds are totally withdrawn.

·         Insurance: Keep all insurance records until the asset is sold and a minimum of five years. For auto, house, umbrella, business continuation, etc.

·         Auto records: For as long as you own the vehicle.

·         Tax returns and associated documents: Generally for seven years. The IRS has three years to audit a tax return. However, underreported income greater than 25 percent has a six-year statute of limitation and fraud has no limitations.

·         Home purchase: Keep the documentation for the purchase cost of the house and any capital improvements – repairs and upgrades – until the house is sold. Records of a new roof, painting, additions, etc.

·         Mortgage: Hold as long as the mortgage is not fully paid. When paid off still hold records for seven years, then have a mortgage burning party and celebrate.

I want to thank my many financial associates (CPAs, attorneys, insurance experts) who helped me come up with this lists.

I hope this has helped you to organize and thin out those bills and documents taking up valuable closet space. Happy shopping to fill up those voids.

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!

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*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.