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Financial Documents: Keep, Scan or Shred?

A few years ago, I had two banker’s boxes full of financial documents I just accumulated over time. Then, one day, I decided I would go through all those documents and actually decide whether I should keep, scan, or shred them. I purchased a Fujitsu ScanSnap S300 [3] to scan any important documents and then some random crosscut shredder from Staples to shred the non-essential documents. Two bags of recycling later, I had rid my life of years of credit card and bank statements I’d never need and put all my important documents in a secure folder on my computer.

Here was my approach:

This post is part of the 2011 Spring Cleaning Week [4]!

Keep These Documents

For the documents listed below, you want to keep the original in a safe place, be it a safe deposit box [5] or just a safe place in your home; and protected. You should also scan these so you have a backup in case something happens to the originals.

Scan These Documents

These are documents where you want to keep them but the original has no added importance.

Shred These Documents

You don’t need to keep these documents past the last one you received and in most cases they are available online. In fact, I’d recommend that you sign up for paperless statements whenever possible (to reduce fraud) and just review them online.

Once you go through your old documents, it’s important to have a system for any new ones. In general, I let financial documents accumulate into a pile and then I batch file/scan/shred them. I don’t deal with each piece as it comes in unless it’s a clear “shred” item like a credit card statement (I use paperless statements so that’s a bad example for me). I prefer dealing with it in batches because it’s easier for me but you can do it however you like.