Tax documents, old invoices, financial records—all of these are essential for keeping a business functional and running. However, the usefulness of these records is limited over time. If these files are left to pile up, they can outlive their usefulness and cause clutter and confusion. That is why it is important to know how long you should keep your old files.
If you have old files piling up and are not sure which ones to get rid of, this guide will help you decide how long to keep them and whether you should look into a document shredding service.
Different Documents, Different Time Frames
Every business, individual, and so on has different needs for different documents. The exact amount of time that you will need to keep these documents can vary heavily depending on the specifics of your situation.
In general, you should dispose of various documents when they have outlived their usefulness. Of course, it can be challenging to determine precisely when you should dispose of certain documents, especially when you have not previously dealt with document destruction. In addition, there are certain documents that you should hold on to forever as well.
The best way to dispose of documents like these is to shred them professionally. This can ensure that any sensitive information that the documents might refer to will remain confidential and the information that is enclosed remains personal and secure. Having this security can save you a great deal of trouble down the line.
Short-term Documents
There are some types of documents that you can dispose of as soon as certain transactions have been verified and are considered complete. Once these transactions are complete, there’s no need to keep the documents that refer to them. Some examples of the kinds of documents in question include:
- Bank statements
- Utility bills
- Credit card statements
Insurance Policies
If you have insurance policies that you pay into, consider keeping the documents related to whatever insurance policies you have on hand. If you decide to end an insurance policy and move on, it is unlikely you will need any of the paperwork related to the canceled policy. Some of the following documents are included under this umbrella:
- Renters insurance
- Life insurance
- Umbrella insurance
- Car insurance
- Homeowners insurance
Holding onto certain documents may help you if you are switching between similar policies, such as car insurance.
Situation-specific Documents
There are certain documents that you should hold onto as long as the entity that you are dealing with recommends that you do so. One of the primary examples of this type of document is documents that you have pertaining to your taxes and to the IRS.
With documents like these, the IRS has a list of recommendations for how long one should hold on to certain documents. For example, the IRS recommends that you hold onto your old tax returns for approximately three years. Conversely, they recommend that you hold onto fraud claims or documents on worthless securities for about seven years.
In general, you should hold onto these documents as long as the IRS recommends that you do so, as it will make whatever transactions and dealings you have with them that much easier. Another example of documents in this category includes documents that refer to properties and investments. In general, you only need to hold onto these types of documents as long as you are involved in the assets they refer to.
Documents You Should Not Dispose Of
There are certain documents that you should attempt to hold onto forever. This is because replacing these documents is either very difficult or, in some cases, basically impossible. Some examples of the documents that you should not get rid of include:
- Birth certificates
- Adoption papers
- Custody decrees
- Marriage licenses
- Divorce decrees
- Wills
- Trusts
- Power of attorney
- Social Security cards
- Citizenship papers
- Military records
You should do your best to keep the above documents as long as possible, as doing so will ultimately make your life much easier than losing them.
The Best Document Shredding Service in Southern California
The Secure Shred Company quickly, confidentially, and efficiently disposes of your excess and unwanted documents. Now that you know how long you should keep your old files, visit our office to discuss disposing of whatever documents you need through certified product destruction.
