I have been keeping all of my receipts for some time now. Every day, I enter them into my money tracking system (presently just a text file where I capture date, payee and amount). Then I file the receipts away in folders by month. My question: does it do me any good to save the receipts, or is having the data good enough? [. ] I’ve never had to bring out individual receipts for tax purposes before, but my understanding is that if I got audited, having all my receipts would be very helpful. Is that true?
Bankrate has an excellent table summarizing how long to keep financial records. To summarize:
- Keep any tax-related records for seven years.
- Keep records of IRA contributions permanently.
- Keep quarterly retirement/savings plan statements until you receive an annual statement. If the numbers match, shred the quarterlies and keep the annual summaries permanently.
- Shred unimportant bank records after one year; keep the rest permanently.
- Keep brokerage statements until you sell the securities.
- Most of the time you can shred bills once you get a cancelled check. Keep bills for big items permanently.
- Keep credit card receipts to reconcile with your statements, then keep the statements for seven years.
- Easy and must do habit -get a copy of your free credit report .
- Paycheck stubs should be kept until you receive your end-of-year tax statements.
- Keep house records permanently. (Some can be held for less time, but I think it’s wise to keep them all.)
Remember: If possible, shred all financial documents when you get rid of them. A program such as Quicken can help you track and manage your finances effectively without leaving a paper trail.
GRS is committed to helping our readers save and achieve their financial goals. Savings interest rates may be low, but that is all the more reason to shop for the best rate. Find the highest savings interest rates and CD rates from Synchrony Bank. Ally Bank. GE Capital Bank. and more.
Category: Personal Finance