Broker Check

WFH or Quarantine: Tips to Organize Your Financial Information

| April 10, 2020

Please also see Everything In Life Has Risk.

Digital - On Line  - Cloud

I happen to be a big fan of digital information and digital "documentation." That is partly because I am not a fan of paper. Which does not mean that paper is not important. Sometimes it is critical. If / when digital documents are easily obtainable and printable, they are practical whenever you do not need an original "wet blue ink" signature. I used to maintain many bankers' boxes of stored documents in a specific storage spot. At some point I realized this spot was vulnerable to fire, flood and other physical hazards. But physical storage that is waterproof and fireproof is not always practical or even possible. And probably difficult to move. Curating and separating might be useful or even critical. On Line / Cloud / Digital copies of critical especially original documents might be financially very helpful.

Pete The Planner 10 Things To Do

  1. Review credit card statements
  2. Review Beneficiary Designations
  3. Freeze credit
  4. Prepare 2019 taxes
  5. Review your Credit Reports
  6. Update W-4
  7. Home inventory for property insurance
  8. Shop for lower property insurance rates
  9. Get your most recent Social Security statement
  10. Add or switch to an online savings account

Declutter - Shred - File Financial Records

4 Places To File / Keep

  1. Pending
  2. Current
  3. Archive
  4. Safe Deposit or Home Safe


  • Marketing materials envelope stuffers
  • ATM receipts after reconciling to bank statement
  • Annual Reports
  • Proxies

Pending File

  1. Need attention this week
  2. Review weekly and move finished items to Current File
  3. ATM receipts until reconciled w bank statement

Current File

Go in and out regularly - One year old or newer

  1. Paid Bills
  2. Bank accounts
  3. Brokerage accounts
  4. Cars
  5. Credit card statements
  6. Tax return current and related documents
  7. Estate planning
    a) Will
    b) Trust
    c) Financial Power of attorney (durable)
    d) Health care Power of Attorney
    e) Living will
    Originals at attorney's office and or where family member(s) Personal Rep can access them
  8. Financial Planning papers
    a) Net worth
    b) Retirement projection
    c) Investment policy statement
  9. Home Real Estate documents for each property
    a) Title / copy / etc.
    b) Bill of sale
    c) Insurance policies and most recent statements
  10. Job-related documents
    b) Contract - employment agreement
    c) Offer letter
    d) Retirement documents 401K - pension - profit-sharing
    e) Bonus plan Deferred Comp
  11. Most recent Tax return (Or separate Tax Files)
  12. Loan documents
  13. Medical records by doctor (or condition if complex)
  14. Phone cable Wi-Fi
  15. Property tax
  16. Utilities

Filing about Technology

  • Keep an inventory of everything that runs on WiFi in your house (smart phones, tablets, Apple TV or similar device).
  • Keep an inventory of all hardware including computers, laptops, printers.
  • Keep an inventory of what is hard wired in your home including security systems, whole house sound systems, internal networks.
  • Keep a list of who to call to repair any of the above!

Valuables - Insurance - Filing - Home Inventory

  • Consider personal articles insurance for individual valuables.
  • Keep records of what you list on this policy
  • And how often you have these items appraised.
  • Home Inventory:
    You should keep a home inventory that goes room-by-room and photographs and lists all personal property. Use this to make sure you are adequately insured on your homeowners and personal articles policies as well as for claims should you experience a fire or robbery. It happens more than you might think. Once your inventory is complete, store a digital record of this in a secure place outside of your home.

Archive Files

Archive files can hold similar files to current with the exception that these are papers that are over a year old that you feel you need to retain including:

  • Car records
  • Estate planning documents that your attorney doesn’t hold or that aren’t in the safe deposit box
  • Home capital improvement records
    • You can add to your cost basis of your home through capital improvements, although not repairs. Many people forget to keep records of what they spent on major projects. By adding these costs to your basis, you may pay less in capital gains when you sell your home.
  • Loan documentation
  • Receipts for big ticket items that may be useful for resale
  • Tax returns for the past seven years (longer if your state requires more years)
    • Keep any supporting documentation that may include cancelled checks or credit card statements.
  • Warranties and appliance manuals
    • You may want to keep track separately of all appliances and valuables with serial numbers.

Safe Deposit Box

Critical documents should be kept in a bank safe deposit box or a fire-proof safe. If you use a home safe, make sure a thief can’t just pick up the whole thing and carry it off. Consider what works for your situation and your space limitations. Here’s a list of key documents to get you started:

  • Birth certificates, adoption papers, marriage licenses, divorce papers, death certificates, citizenship papers
  • Titles, deeds
  • Insurance policies
  • A digital record of your home inventory and any cherished photos

Work Smarter

Once your filing system is set up and your current paperwork is under control, your next step is to set yourself up to keep control in the future. Here are some things you can do to work smarter:

  1. Go paperless.
    A. Sign up for electronic statements and confirmations on your investment accounts.
    B. Pay your bills and do your banking online.
    C. Buy a scanner to save copies of documents you want to keep (make sure you back up all your electronic records).
    D. Purchase a shredder to help you safely destroy sensitive material and prevent identity theft.
  2. Create a new daily, weekly or monthly habit of organizing your financial paperwork. Once you’re in a routine that works for you, you’ll be able to stay organized.
  3. Coordinate with your organizer/calendar. As you file, make notes in your calendar of due dates and action items.
  4. Create a financial inventory of all the pieces that are important to understanding your financial situation. This could include a list of financial institutions, account numbers, safe deposit box contents and a list of important contacts such as your financial advisor, attorney, and accountant. This will help you keep track of what you’ve got, but it will really help your loved ones figure out what they need when you are gone. 

You don’t need to be an organizational guru to be able to find your tax return when you need it. You just need to clear out what you don’t need, organize what you want to keep, and work smarter at staying on top of it.

Just cleaning out a drawer or closet can give you a sense of joy because you get rid of what you no longer need, and you can find what you use all the time. While you may not particularly enjoy the process of cleaning up financial records, you only need to do this once a year, other than periodic filing. Put on music you love or some television marathon (not about COVID19) and try to enjoy the time it takes to clean up your records. If you can enlist someone to help you, the time passes more quickly and can even be fun. Just keep your social distance.

Once your records are organized, think about what you do have that you want to keep. Ask yourself these questions:

  • Bank accounts
    • Do you have too many? What is the purpose of each? Are you getting competitive rates? Lots of people need to consolidate and simplify. Be clear about your intention.
  • Brokerage accounts
    • See Bank accounts…
  • Retirement accounts
    • When is the last time you looked at what you were invested in within your company retirement account? Is it time to review that? Change your asset allocation? Lots of people “set it and forget it” at work and never change anything for years at a time. If you don’t attend to your finances, don’t be surprised when they don’t perform as expected.
    • Do you have too many old retirement accounts? We see this all the time. People get busy and don’t roll over their old 401(k) accounts or consolidate old SEP accounts when they no longer have self-employment income. Clean this stuff up. You’ll get better economies of scale, you’ll have an easier time tracking everything, you’ll probably make better investment decisions.
  • Insurance
    • How much life insurance do you have? Too much for your current circumstances? Too little? If something happened to you, could your kids finish college? Could your spouse pay off the mortgage? If you have old policies, when do they mature? Should you consider converting some of those policies to paid-up coverage?
    • Is your disability coverage keeping pace with your salary? If you have coverage through work, is there a cap? Is that enough to take care of your family? Do you need more?
    • Health insurance: For people approaching retirement, this can be scary and sometimes keeps people in the work force just to have health insurance. If you are thinking of retiring before age 65 (Medicare eligible), how will you pay for private coverage? Have you thought about supplemental health coverage in retirement (Medigap)? How about long-term care insurance?
    • Property and casualty: Have you looked at homeowners, auto and personal liability lately? Do you know if you are covered for cyber attacks? Do you know how long you can cover adult children driving your cars? You don’t need to look at this every year, but has it been more than five years since you’ve taken a look? If you are in an area of the country that is prone to mud slides, earthquakes, or fires, do you have adequate coverage? Is it time to consider a different carrier that caters to higher wealth issues?
  • Credit cards
    • How many do you have? What rates are you paying? What perks are you getting? How many people are on each card? Do you have household employees with cards that you should review? What are the limits?
    • Have you checked your credit rating lately? With the constant flood of compromised data, have you frozen your credit records?

Clean Up Your Act

Excavation and organization aren't sexy or glamorous. But it can be liberating. It can be freeing. Once you’ve put in the work on cleaning things up (and admittedly that can take some time!), you’ll be able to focus on the things that really matter to you.

Just like cleaning your closets or Kondo-izing your clutter, clearing out what you no longer need from your financial life and making room for what you really want sets the foundation for a healthy, happier present and future.

And maybe it will help you pass the time while we all watch and wait. Now go wash your hands and get started.

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