Tidying Up Financial Clutter

Here’s what you need to hang onto and for how long:

Items to Keep	When to Toss
Medical bills	Once the claim has been paid, you don’t need these any longer, unless you’re deducting the medical expense on your annual tax return. Then follow IRS guidelines for keeping these documents.
Utility bills	Typically, you could dispose of these after your bill has been paid. If you anticipate selling your home, hang onto the last year’s worth to help potential homeowners.
Documentation of major loans and insurance policies	Keep these along with all of your important identification papers (birth certificates, marriage license, Social Security cards, passports, etc.) in a secure spot, such as a safe deposit box at your local bank or a firebox at home. Keep payoff statements forever.
Annual tax returns and supporting documents	Keep the most recent three years. You can be audited for up to seven by the IRS (see irs.gov for additional information).
Paystubs	Keep these until you’ve received your annual W-2 form.
Property records that show improvements to your home	These can be used when selling a home to offset capital gains when the property is eventually sold. Keep until the house is put up for sale.
Bank statements	Keep these for one year.
Investment documents	Keep all capital gains tax reports for three years.