As much as we try to be a paperless society, we still have paper to contend with. The key to taming the paper tiger is having a system – and then using the system including everybody in the household.
The first step is to have a single location for where mail goes when it enters your house. Handling paper quickly and one time is key to decluttering and managing your home.
Your mail can be sorted into 3 categories:
- Throw –> toss immediately
- Action now –> an item that needs signing and returning
- Action later –> such as a bill to pay. (A bill paying folder, one for each week of the month. Put a bill in the folder for the week it is due)
If you have several family members, they may need their own mail file. The key is to be consistent and handle mail daily at a designated location.
Bill paying Systems are helpful, not only for taming the paper tiger, but helps with cash flow management.
More and more companies are moving towards receiving payments online. This can be convenient for you as well as the vendor. Be sure you are keeping a record of when the payment will be made if it is automatic. Include a list of payments made on line in your weekly accounts payable folder.
If you have a file with paper copies of the bill, you need to clear annually. If it isn’t needed for your tax return, shred it.
Organizing tax records is important to minimize your tax bill and make filing your tax return easier. Most tax documents come at the end of the year and the first few months into the New Year. Companies are getting pretty smart and telling you on the envelope that it is IMPORTANT TAX INFORMATION.
Have a central file folder with the year and tax information label. When tax information comes in, put it into the folder. (I chuckled as I prepared tax returns… clients had a folder, but it had my name on it.)
Tax documents include 1099, W-2’s, donation receipts, medical payments, childcare costs, college tuition paid, student loan payments, estimated tax payments.
Securities and advisory services through KMS Financial Services, Inc.