How Long to Keep Documents
Do you feel like you are drowning in paper? Trust me when I tell you, you are not alone! Too much paper is one of the most common clutter issues. While it is important to keep proper records, it is not necessary to keep every document forever. Below you’ll find a guideline to assist in determining how long to keep the most common business and household documents. I’ve also included some helpful tips on how to store and discard documents and an easy strategy to maintain your newly tamed paperwork. Please note, the information provided is meant as a suggested guideline. I am NOT an accountant or financial expert and you should always check with your accountant regarding the retention of financial and tax documents.
HOW LONG TO KEEP
|Bank Withdrawal & Deposit Slips||o Check against your bank statement to make sure the amounts match, then shred.|
|Monthly Bank & Credit Card Statements|
o If related to your own business, 6 years from the end of the last tax year the bills relate to. Then shred.
o Otherwise, 1 year, then shred.
|Monthly Brokerage & Mutual Fund Statements|
o If you own your own business, 6 years from the end of the last tax year the bills relate to. Then shred.
o Otherwise, 1 year, then shred.
|Monthly Mortgage Statements||o Reconcile with your annual statement, then shred.|
|Annual Mortgage Statements||o 6 years, then shred.|
|Pay Stubs||o 1 year. Reconcile with T-4, then shred.|
|Tax Returns, T4s, Receipts & Statements for Tax Returns||o 6 years. Includes donations, RRSP contributions, childcare receipts, mortgage interest, medical expenses, property tax payments, alimony/child support (paid or received) etc., then shred.|
|Phone, Internet, Utilities|
o If you own your own business and write off these expenses, 6 years from the end of the last tax year the bills relate to. The shred.
o Otherwise, 1 month, then shred.
o If paid by credit card, keep until you receive the statement to ensure the amounts match. Then shred.
o If the item purchased has a warranty, keep until you no longer own the item or the warranty expires. Then shred.
o Otherwise, enter into your monthly budget, then shred.
|Insurance Policies (Life, Home, Auto)||o As long as the policy is active or there is an outstanding claim, then shred.|
|Auto Records||o As long as you own the vehicle. Then shred.|
|Investment Records||o Forever.|
|Pension Plan Records||o Forever|
|Loan Terms, Repayment & Discharge Documents|
o Keep all terms and repayment documents until the loan is paid off, then shred.
o Keep loan discharge documentation forever.
|Medical Records||o Forever.|
|Military Records||o Forever.|
|Receipts for Major Home Renovations||o Forever.|
|Birch Certificates & Adoption Records||o Forever.|
|Marriage Certificate, Divorce & Custody Records||o Forever.|
|Wills, Power of Attorney & Death Certificates||o Forever.|
A Few Tips
1) Keep business paperwork separate from personal paperwork.
2) Store documents in a cool, dry place off the ground.
3) Keep important documents such as birth and marriage certificates, adoption records, Wills and Powers of Attorney etc. in a safe place such as a locked, fireproof safe.
4) Remember to shred all documents you are discarding.
Maintenance of your Filing System
After you get your paperwork in order, remember to schedule regular maintenance (weekly, bi- weekly or monthly, depending on your needs) to make sure your records are up to date and all paperwork is in its proper home. A good system to follow is the “one in, one out” method. For example, for monthly credit card statements (not used for business purposes), when you file the most recent month’s statement, take out the monthly statement from 1 year ago. The idea is that every time you file a document, you also take one out. Regular maintenance is key to ensuring paperwork doesn’t build up again.
For more information on document retention, you can check out the Canada Revenue
Agency’s site: https://www.canada.ca/en/revenue-agency/services/tax/businesses/topics/keeping-records.html
For a one-page summary of this list, please click here.
Now go get filing!