Safeguarding Important Documents: 4 tips for knowing what to keep and how to store it

Whether it’s inspired by a New Year’s resolution or a total rearrangement of your home during a deep spring cleaning, organizing your legal and financial files is a great idea because it can be somewhat tedious. If an emergency occurs and you find you have been procrastinating, you will regret not being on top of things.

One way to get motivated is to remember how frustrating it can be to keep things in a state of disarray. You may tear the house or office apart looking for that critical document at tax time, or stay up half the night trying to find your passport before a much-needed vacation.  Don’t put yourself through all that unwanted and unnecessary stress. Follow these four basic tips and guidelines to get your affairs in order and you’ll have priceless peace of mind:

What to Save

To simplify the process, start by making a list of items that are most essential for safekeeping.

  • A birth certificate should be a top priority, but a mere photocopy is not necessarily good enough. The U.S. State Department, for example, expects passport applicants to submit birth certificates.
  • Your Social Security Card is another critically valuable document. Although the cards are small, they have gigantic importance and you certainly do not want to misplace yours.
  • Retain copies of marriage and divorce papers, mortgages and deeds, your Last Will, evidence of military service, and anything valuable that would be difficult or impossible to replace.

Where to Store Documents

Important documents you should consider keeping in a safe deposit box at your bank include:

  • Birth and marriage certificate
  • Divorce papers
  • Adoption papers
  • Citizenship records
  • Military service papers
  • Deeds for vehicles or real estate and mortgage papers
  • Copies of leases
  • Insurance policies
  • Patents
  • Other irreplaceable documents that may have sentimental value
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You may notice some items aren’t on that list, but there’s a good reason for that. Not all documents should be locked up at your bank, and here’s why:

  • Stock Certificates -The replacement cost of lost stock certificates or other securities like government bonds can be time-consuming and costly, so it is best to entrust those to your stock broker for safekeeping.
  • Will -Many people store the original copy of their Will in a safe deposit box, but this is not a good idea. You may keep a copy of it there, but have your attorney retain the original inside a safe in the attorney’s office. The reason for this is that upon your death, legal access to your safe deposit box by other may be restricted for an extended period of time.
  • Power of Attorney (POA -)The original copy of a POA document should also be handled in the same way because if it gets lost, you will likely be required to draw up a whole new document, which may be impossible, however, if the person who granted that POA is incapacitated. You may be the designated POA person, for example, for an elderly parent who suffers from Alzheimer’s or for a loved one in a coma -they do not have the ability to authorize and sign a new POA, and so the original must be vigilantly guarded.

Tax Documents

The IRS generally has three years from the year you file to perform an audit, but if you fail to report more than 25% of your gross income they can audit you within six years. Meanwhile, if they suspect you filed a fraudulent return or failed to file a return there is no time limitation.

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For that reason many top tax experts recommend that you save critical tax-related documents indefinitely. Others say that you don’t need to keep them for more than six years. As with many things related to dealing with the IRS, there is no clear-cut answer. If you took deductions, play it safe and save the receipts that support your argument that those were legitimate.

How to Replace Vital Records

To acquire a replacement Social Security Card, you will need to contact the Social Security Administration. The most efficient way to start the process is to visit the Social Security website, fill out an application for a new card, and then mail it in or take it in person to a Social Security office along with supporting identifiable documents that are listed on the SSA FAQ page.

The registration of births in each state in the USA has been mandatory since 1920. Some states maintain records that are even older than that, so a good place to start is by contacting the Clerk of Court or Registrar of Deeds at the courthouse in the county or city where you were born. Oftentimes you can locate a copy of someone’s Last Will and Testament this way, too, for example, or request a copy of a birth, death, or marriage certificate, or divorce decree documents. Keep in mind that certified copies of birth certificates must include the registrar’s raised, embossed, impressed or multicolored seal, and their signature.

If you are looking for a copy of a check or stock market transaction, ask your bank or broker. They typically retain copies for a quite a long period of time and you can even access bank statements through an online account. Similarly, doctors and hospitals may have a copy of whatever medical records you need.

About the author

Mark Holland

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