Are You Drowning in Financial Documents?

Do you want to know how to make your life a bit simpler and more organized now—and the lives of your family members easier when you’re no longer around? Here’s an idea: start ditching the paper.

Okay, maybe not all of it. But most of it you can probably do without.

First, you should know which documents you’ll need to keep in their original paper form. Fortunately, this list is fairly short:

  • All birth certificates
  • Marriage licenses and/or divorce decrees
  • All Social Security cards
  • Diplomas, especially college and post-graduate
  • Education transcripts
  • Wills

Keep in mind that your individual situation may warrant keeping a few other documents in their original form, but, in general, those are the ones that are most useful to have.

As technology has improved, we now have more opportunity to store many of our financial documents in digital form through an online service. These services act as encrypted safe deposit boxes where your documents can be securely stored—in most cases, for an indefinite period of time. They’re relatively easy to set up, and you can get one directly through us at luciacap.com by filling out this form. The beauty of this system is that, besides the absence of paper and clutter, these documents can be accessed by you or anyone else of your choosing from anywhere in the world.

So, which documents can you relegate to online storage?

  • Tax returns: 7–10 years of anything related to the IRS or your state tax board
  • Insurance policies: especially life insurance, which may need to be accessed by family members on short notice
  • Photos: personal photos and those you need for homeowners insurance purposes
  • Title deeds for your house, car(s), etc.
  • Brokerage statements
  • Digital files of health benefits
  • Home improvement records

In general, if you believe that you’ll need to access certain documents well into the future, the cloud is a good place to store them.

And what can you send straight to the shredder? Here’s a short list of things that most people don’t need to keep:

  • Bank statements
  • Expired warranties
  • Utility bills (unless you need them to verify your address)
  • ATM receipts
  • Credit card statements

As for bank and credit card statements, check with your bank first to find out how long they keep them for you online. Many store them for you free of charge for 12–18 months, a few perhaps a bit longer. Here’s a good rule of thumb: if you haven’t needed to access any of these documents even once over the past five years, you can probably shred them.

The bottom line is this: paper and clutter can get out of hand quickly, and we have the technology available to us right now to do something about it. It’s time to get organized!

Information presented should not be considered specific tax, legal, or investment advice. You should always seek counsel of the appropriate advisor prior to making any investment decision. All investments are subject to risk including the loss of principal. This material was gathered from sources believed to be reliable; however, its accuracy cannot be guaranteed.

Raymond J. Lucia Jr. is chairman of Lucia Capital Group, a registered investment advisor and CEO of its affiliated broker-dealer, Lucia Securities, LLC, member FINRA/SIPC. Advisory services offered through Lucia Capital Group. Securities offered through Lucia Securities, LLC. Registration with the SEC does not imply a certain level of skill or training.

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