Get Organized!

Okay, don’t get frightened by the sight of this. Once you get organized, it will make handling your bills so much easier—I promise!

I learned this system from David Bach’s books, Smart Women Finish Rich and Smart Couples Finish Rich and have tweaked it a little bit.

This was created as a paper filing system, but if you prefer to do it electronically, you can apply the same approach on your computer. Most likely you will end up with a hybrid system—folders for those items that need to be physically maintained and files on your computer for everything else.

Already have a system in place? Compare it to the one below to make sure you have everything covered.

Time Needed

• Set aside an hour or two to do this, depending on how (un)organized you are now 😉 (If you can’t do this today, commit to doing it soon (like tomorrow!) because the next few steps will build on this!)

Materials Needed

• 12 hanging file folders and 40-50 file folders if you’re a “paper person.” (Much less if you’ll be doing an electronic or hybrid system.)
• An existing filing cabinet or portable filing box.

Directions

• Gather up all your current bills and financial paperwork.
• Label one hanging file folder for each of the 12 categories below.
• Within each hanging folder, use one file folder to represent each account you have in that category.
• If you’re doing this on your computer, create a folder for each category, and then nest subfolders accordingly.

1. Tax Returns

Decide how far back you want to keep your tax returns (anywhere from 3 years to “forever” depending on your situation) and use the corresponding number of file folders plus one for the current year.

Label each folder with the year and place your filed returns in them.

The folder for the current year should be used to store receipts throughout the year that you will need at tax time as well as to collect your tax documents as you receive them. When it’s time to do your taxes, everything will be in one place!

2. Retirement Accounts

Keep all of your retirement account statements here. Designate one file for each account you have, and label it accordingly. This is where you will file your quarterly statements as well as any initial sign-up documents you have.

3. Social Security

Keep your annual Social Security Statement here. They are no longer mailed out (unless you meet specific criteria), so hop online to download your most recent statement.

4. Investment Accounts

This folder will hold the statements for any non-retirement investment accounts you have. Designate one file folder per account and label accordingly.

5. Bank Accounts

Store your monthly bank statements here. Label and use a file folder for each savings and checking account you hold.

6. Household Accounts

This folder contains any documents related to your home as well as recurring household bills. Use and label one file for each of the following:

• House Title
• Home Improvements
  File your receipts and records of any home improvements.
• Mortgage or Lease
  File your mortgage documents and monthly statements or lease and payment receipts.
• Utility Accounts / Household Bills
  Use and label one folder for each utility or service account you have (electricity, gas, internet, cable, phone, cell phone, etc.) and file your monthly statements here.

7. Debt

This folder should hold the records for any debt you have outside of your mortgage (credit cards, car loans, student loans, tax debt, personal loans, etc.) Include any accounts you may have in collections. Label one folder for each loan/account, and in it place the original terms of the loan/agreement as well as the monthly statements.

8. Other Bills

This folder holds any other bills you have outside of your debts and household accounts like gym memberships, subscriptions, etc. Anything that you pay on a recurring basis. Label one folder for each account. If you have a lot of medical and dental bills, you may want to create a folder for them as well.

9. Car

Use this folder to file your car title and maintenance and repair records. If you have more than one car, use one file folder for each.

10. Insurance

All your insurance documents go here. Create a separate folder for each policy (life, auto, homeowners, renters, etc.). Include the original policy documents as well as any monthly statements you receive.

11. Family Will or Trust

A copy of your will or living trust goes in here.

12. Children’s Accounts

If you have kids, use this folder for any bank accounts and investments you have for them. Label one folder for each account.

Okay, you’re done! You’ll end up with 12 folders if you have kids (11 if you don’t). Feel free to add any folders if your situation warrants it.

You now have an organized system to store and keep track of all your bills and financial documents!