tidy upIf you’ve been using social media or keeping up with the news, you’ve likely noticed the recent trend of donating belongings that don’t “spark joy” and rearranging the remaining ones. Thanks to word of mouth, the Netflix show Tidying Up with Marie Kondo and Kondo’s books, organizing is catching on as the latest must-do for you to better your home and lifestyle. In light of this development and the stacks of financial documents likely piling up in your home, we’re tackling the subject of how you can tidy up your financial clutter. Keep reading to learn more about how long you should keep your different financial documents as well as when you should throw them away.

Why go through your financial clutter?

Is it really necessary to organize your financial clutter? After all, as long as you have the room and don’t mind clutter, letting them accumulate for the rest of your life may not seem like an issue at first glance. When the stacks of your papers keep piling up, however, there comes a time when it’s more worthwhile to part ways with what you no longer need. That’s because it could become increasingly difficult to keep all of them organized, increasing stress and complicating your process when you have to engage in financial record keeping. On top of all that, if your documents aren’t secured and organized well, it could be easier for you to lose track of some of them, which could result in something critical going missing — not ideal if it turns out that you’re being subjected to familiar fraud or financial abuse.

One more note before we proceed to the meat of the post: once you’ve deemed that a financial document is ready to be trashed, you’ll want to properly dispose of it to prevent identity theft — something that’s a nightmare to experience. We recommend using a cross-cut or micro-cut shredder to destroy all materials containing sensitive personal information, which you can learn more about by reading our guide to protecting yourself from dumpster divers.

How long should you keep your documents?

The length of time you should keep your documents varies, since the duration depends on the type that you’re thinking of tossing. That said, here are some general guidelines regarding when and why you should throw out your tax records, monthly bank and credit card statements, paycheck stubs and receipts. Note that the information provided below is general advice –different personal situations and circumstances may call for you to keep your records for longer periods of time. As such, we suggest that you make the best decision for your personal situation.

Tax records

How long should you keep your tax records?

For the average consumer, it’s best to keep your tax returns permanently, and you’ll want to keep your supporting tax documentation for three to seven years. To verify what you should do based on your personal circumstances and situation, make sure to contact your CPA, as they will be able to provide you with the best advice.

Why should you keep them for that amount of time?

Business Insider and Bank of America suggest not tossing out tax returns, as they’re important documents that show your financial history. Bank of America also recommends keeping supporting tax documentation for three to seven years, since the IRS may ask for these types of records within that time frame. That all said, you’ll want to consult with your CPA for more information, since the best thing for you to do varies based on your tax situation.

Monthly statements

How long should you keep your monthly statements?

If there are online records of your monthly statements (e.g., bank statements, credit card statements and more), you don’t need to keep hard copies of the statements since you can access them online. On the other hand, if you don’t have access to online copies of your statements, you’ll want to keep hard copies for about a year. If you need to use the statements for tax purposes, it makes sense to keep them for a longer period of time.

Why should you keep them for that amount of time?

Generally speaking, you’ll want to keep the statements (or be able to access them) for at least a year, giving you the time to check them to make sure they’re accurate and free of mistakes and signs of fraudulent activity. After all, it could be a nightmare to throw away the documents and find out later that there was some issue with them. That said, if you need to keep these statements for tax purposes or other reasons, it can be helpful to keep hard copies for a longer period of time.

Paycheck stubs

How long should you keep your paycheck stubs?

You’ll want to keep your paycheck stubs for at least one year.

Why should you keep them for that amount of time?

It’s generally recommended that you keep your paycheck stubs around for a year, since you should use them to verify that your W-2 is correct. Once you do that and pay your taxes for the year, you can dispose of your paycheck stubs.

Credit card and debit card receipts

How long should you keep your receipts?

Receipts for goods or services don’t need to hang around in your home as long, as they only need to be kept until you finish checking your monthly statements.

Why should you keep them for that amount of time?

After you’ve used your receipts to verify that your monthly statements are accurate, there isn’t much further use for them. Unless you think that you may be returning an item that you have a receipt for, you can dispose of your receipts after you’ve checked your statements.

Preapproved offers

How long should you keep preapproved offers?

If you’re not planning on pursuing a preapproved credit card offer, we recommend that you properly dispose of it as soon as possible.

Why should you keep them for that amount of time?

There isn’t much use for a preapproved offer that you don’t want, so chances are that it would just end up sitting around and adding to the clutter in your home. As such, it’s best to properly dispose of your preapproved credit card offers as soon as you know that you’re not interested in them.

Now that you know how to tidy up your financial clutter, learn more about what you can do to protect yourself from identity theft. Make sure to follow our identity theft blog for more tips and information.