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Properly Storing Your Financial Records

How to store your digital and physical financial records

Your financial records contain identifying details and account information that can be dangerous in the wrong hands. That is why it is so important, from both an organizational standpoint and a safety perspective, to properly store your digital and physical financial records. Here are a few tips to help you file and protect this vital documentation.

Create a multi-faceted system

Paper documents and digital records have to be stored differently, but the essence of your storage systems should share some characteristics, according to Kevin Payne, contributor to Most notably, you’ll want a storage solution that you can access easily and that safeguards your information from theft whether in the real world or virtually. You also need to keep your system organized and secure from damage. For example, if your basement regularly floods, you probably don’t want to keep your filing cabinet there. And if your home computer lacks antivirus software, you’ll want to avoid storing your files there until you have installed it.

Paper records

The length of time you need to store paper documents varies by the type of document. You only need to retain credit card receipts, ATM receipts, and deposit slips from your financial institution for about a month, according to Amy Livingston, writer for

“You can stash these in an envelope or pin them on a receipt stand,” she advises. “At the end of the month, you can check them all against your credit card or bank statement and then dispose of them.”

Store your quarterly investment reports and insurance forms for 12 months, recommends Livingston. Look for a hanging file crate, accordion file organizer, or traditional filing cabinet in which to store them.

Purchase a lockable file cabinet or fireproof safe for important documents you need to store long-term. That includes health insurance policies, loans, benefits received from the government or your employer, mortgage details, taxes, and property records.

“A home safe doesn’t have to be elaborate or expensive, like something you’ve probably seen in the movies (no need for hidden wall safes behind artwork). A simple lockbox you can grab and go is perfect for storing documents in the event of a home fire or flood,” according to Payne.

When it is time to purge your paperwork, shred them thoroughly, so your personal information is protected from identity thieves, warns David Dierking, writer for

Digital documents

Digital documents free you from paperwork clutter and won’t succumb to weather-related damage or natural disasters. However, the digital world poses plenty of threats to your digital documents’ safety. To help protect your digital records from online hackers, malware, and viruses, you need to make sure you use strong passwords unique to each record, advises Livingston. You will also want to change your passwords regularly, and your computer should have working antivirus software and be plugged into a surge protector to keep it from being fried, she adds.

Finally, you need a backup plan for everything you store on your computer. Livingston notes you can use a password-protected external hard drive to back up your files or store them in the cloud.

“Using cloud-based storage not only saves on space, but also can be great for organizing and keeping your documents secure, since most services guarantee protection through encrypted networks,” according to Payne. Use these tips to help secure your physical and digital financial records. Don’t let thieves steal from you.Use these tips to help secure your physical and digital financial records. Don’t let thieves steal from you.