I can hear the groans already….it is time to deal with the darn paperwork!
Each and every week, paperwork is an area where a large majority of our clients struggle. It is difficult because it continues to come into our home, we need to make decisions about every piece and often take some further action and some things we need to retain.
We are also going to review the storage of our paperwork this week, and the things that we store them in.
Before we get started though, the very first thing we need is a structure for our filing system and knowledge of what we need to keep and for how long.
Have you got a file structure?
If not, today is the day to get started!
It is so important to have a structure that is simple and makes sense to you and all of the users of the system so that you can find what you need when you need it. Sometimes we need paperwork in stressful situations, such as for insurance claims. You don’t want extra stress involved with finding the paperwork too so having a system in place will pay dividends for years to come.
When approaching paperwork, you should ask yourself the following questions:
- Why do I need to retain the information?
- When will it be used and how?
- How long do I need to keep it for?
The answers to these questions will help with setting up and maintaining a practical and useful filing system.
I highly recommend you document your structure and keep it handy at the front of your filing system. You should also note retention dates for sub-categories and seek guidance of professionals such as accountants, solicitors etc. as well.
So how do we decide what stays and what goes?
For the storage items such as filing cabinets, concertina files, folders, boxes or whatever other storage container you have, ask yourself the following:
- Do I use it? Has it been in storage for months or years?
- How many do I have, need and use?
- Does it fulfil the function it was purchased for?
- Is it past its useful life?
If it doesn’t have a functional role in your home, it is time to move it on.
Deciding on paper is a little more complex as each sub-category of paperwork will have different relevance and importance for you.
I could do a complete blog on setting up and maintaining your filing system and will do so soon, but to assist you this week, here are a couple of Australian Taxation Office (ATO) links that may be of assistance:
A few quick wins for you in regards to paperwork though might be:
- Old tax returns: The majority of people in Australia only need to retain their past 5 years of tax returns, not seven (or even 27!)
- Receipts for purchases more than 30 days old should be removed, unless:
- they have a warranty in which case, I suggest you attach the receipt to the warranty slip, highlight the expiry date and dispose of it after this time; or
- they are for tax deductible items so you should add them to your tax file (remember, we also need to consider when something is needed and if they only reason you will need it again is for your tax return why not put it in your tax folder rather than double handling it at tax time?)
- Old bank statements: again, if they are needed for your taxes, pop them in your tax file. If not, let them go as you can always download them or request them from your bank if you really need the information for something in the future.
What do I do with the keepers?
The physical storage items need a home so that they in turn can provide the paperwork to be retained with a home.
The paperwork should be stored logically (ie so that it makes sense to the users) somewhere that is easy to access with minimal risk of damage. It really doesn’t matter if you choose to store papers in folders, boxes or a filing cabinet as long as you can get to them when you need to.
What do I do with the ones that no longer have a purpose for me?
If the storage items are still in good condition but no longer have a purpose in your home, you can consider some of these sell/swap and donation options.
- Sell or Swap:
- Swap with your friends or family.
- Facebook Marketplace or any of the myriad of Buy/Swap/Sell groups
- Garage Sale
- Donate/Gift options:
In relation to paperwork, it is worth shredding paperwork that contains personal information. You can do that at home if you have time and a shredder and then dispose of the shredded paper by any of the following means:
- Place it in your garden and wet it thoroughly on a daily basis for a week as this helps start the decomposition process;
- Ask your local pet shelter if they have a use for shredded paper; or
- Place in your recycle bin inside a large paper envelope. Unfortunately shredded paper can contaminate and block the sorting machines at some recycling depots however this doesn’t happen if it is contained.
If you have a lot, it is worth considering a service such as the one provided at Officeworks. You can take your box of paper down there, hand it over the counter and it is placed into their commercial shredding machine and is gone before you know it. You don’t even have to take out the staples! It is also surprisingly budget friendly.
How did you go? Feel free to share your successes, challenges and tips on our Facebook page.