Shredding Personal Documents and When to Dispose of Them

Tax information and returns

There is a general three-year statute of limitation for your taxes. This means the IRS has three years from when you file your return to start an audit. (There is no limit for fraudulent returns). Therefore, you should keep documents that support items on your tax returns for at least those three years. Each year you can throw out the three-year old documents, but you should keep copies of tax returns forever.

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Investment records and statements

Investment records should be kept to support your tax returns. Documentation of purchases and sales (either confirmations or brokerage statements including the information) should be kept for three years past the date you report the sale on your tax return. You may find it helpful to keep brokerage statements longer than the three years.

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Bank statements

You may want to keep bank statements for some period (three years or so) so you can document your payments for important items. Together with your account register, you would be able to identify when and how much you paid for almost anything.

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Canceled checks

Since the advent of Check 21 laws permitting banks to use digital copies of checks in place of paper, banks very seldom send actual canceled checks with statements. Instead, you may receive images of the fronts and backs of canceled checks. Check images may also be available online through Online Banking. Print out and keep images of canceled checks that support any tax deductions and any you think may come in handy. Ask your bank how long digital images are stored online, because requesting a copy after that may generate a fee.

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Paycheck stubs

These documents can include very important information, including Social Security number and financial institution account numbers. You may need to have the last three month's stubs if you are planning to apply for a loan.

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ATM receipts

Keep ATM receipts until you have compared them with your bank statement.

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Credit card statements

Even though there is no requirement to keep these statements, you may want to save them for some period (a year) in case there is a dispute, if you want to return an item, or if you want to be able to analyze your spending.

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Credit card receipts

Generally, keep receipts until you have compared them to your credit card statement. However, if the receipt is for something you may want to return, or something that may relate to a tax return, keep it longer.

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Utility bills and other household receipts

Unless you are claiming household expenses as tax deductions, there may not be a need to keep these types of records very long. You can typically use a canceled check to document payment.

Shred

Warranties

Keep warranties for as long as you own the item or until the warranty period expires.

Probably safe to toss in trash

Insurance

Insurance policies and claims information should be kept for as long as the policy remains in effect.

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Home financial information

Deeds, mortgages and information on home improvements should be kept for as long as you own the home, at a minimum the three year period for tax purposes.

Shred

Personal documents and pictures

This is your personal preference.

Shred anything containing sensitive information and private pictures.