It's that time of the year again, for business it's a new financial year, for individuals it's tax time. Either way it's a good time to have a look at your filing system and give it a bit of a clean out. Over time filing cabinets fill up, making it harder to find what you need and even harder to file new documents. Eventually it all gets too hard and the piles of paper starts growing elsewhere. To avoid this, it's a good idea to have a bit of a "maintenance session" on your filing system once a year or more.
Step 1. Clear out the clutter
How often do we file things away for them to never be needed again? I'm not saying we shouldn't keep those "just in case" documents, receipts and instruction manuals. If you've got the space and an organised system set up, it can be so satisfying to pull out a receipt for that dodgy appliance and find that it's still covered by warranty. But there comes a time when you're never going to need that gas bill for the house you rented 5 years ago, or the instruction manual for the kettle that you don't even remember owning. Get rid of it!
What to throw out (or shred if it's personal)?
- tax records older than 5 years (or 7 years for business)
- bills and bank statements older than a year, if not needed for tax records. You can get most of these online now and once you've checked that the charges are correct and you know they've been paid, there's rarely a need to go back to them.
- insurance docs that are no longer current (newer policy, no longer own car/house, no claims connected)
- Receipts for items no longer owned or out of warranty. Some people like to keep them longer so that they can see how old something is. I would suggest making a single note at the front of the "warranties" file to record all older product info in one place.
Step 2. Make sure the categories make sense
Now is a good time to go through and make sure all your file names make sense and aren't doubled up. Sometimes you might forget that there's already a file for "credit card statements" and so you start a new file called "VISA statements". When you're looking for that statement to check an incorrect charge, where will you look? There's no right or wrong answer here, it's what works for you. In saying that, if there are a number of people likely to use this filing system, you'll need to consider what "most people" would look under to find things. It also depends on the volume of paperwork you are storing. If there's not alot you may keep it fairly generic and file everything to do with your car/s in one file, but if there's too much information there it might be easier to separate it into car insurance, car services, car regos, or a file for each car.
Step 3. Is the file storage system appropriate?
Are you still struggling to fit everything into your filing cabinet or storage system? If you've gotten rid of those files that you don't need and archived the older documents that you still need to keep but don't need to access regularly, then it may be time to consider upgrading your filing cabinet or even make a change to a lateral filing system. Or maybe you don't actually need that 4 drawer cabinet taking up all that space in your office and you could use something smaller.
Step 4. Label and re-file
Now all that's left to do is make sure all files have a nice clear label on them - printed works best - and file them in logical order. This could be alphabetical or importance or some other order that works for you. For example in the drawers pictured below, the files most often added to are documents related to tax returns, so we put those at the front and then other categories alphabetically after that.
These drawers now have enough space in them so that files have room to move, you can easily dig out the receipts and deductions for your tax return and new documents can be added easily.