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A Reformed Hoarder's Guide to Records Storage

April 11, 2012

Time to Banish the Pack RatMy name is J.D., and I'm a hoarder. I'm afraid to toss anything, particularly financial records. For more than two decades, I've been stuffing shoeboxes with Subway receipts, canceled checks and Amazon invoices.

Recently I moved from an 1,800-square-foot house (plus storage space) to a 700-square-foot apartment. Necessity forced my hand: I had to learn which financial records to keep and for how long. Here are the questions I pondered.

Why? There are two basic reasons to keep records.

What? Whether your documents are digital or on paper, the IRS recommends holding on to basic records in four categories.

When? There's a sweet spot between tossing all receipts before you leave the store and keeping evidence of every sandwich you've ever eaten. The IRS guidelines are a little complicated, but, in general, you should keep financial documents for the following lengths of time.

For more detailed guidelines, download IRS Publication 552 ("Recordkeeping for Individuals") and IRS Publication 583 ("Starting a Business and Keeping Records") from

Where? Scanned documents work as well as hard copies for everything except your will, and the paperless route is clutter-free. Document scanners make it easy to convert paper statements to PDFs, which can be backed up to an online service like Dropbox. If you insist on keeping hard copies, collect your receipts and records for any given year in one large envelope with the date marked on the outside.

I was pleased to learn that I don't need to keep most of the financial documents I had squirreled away for decades. To celebrate, I built a toasty fire and burned my financial history. Instead of 20 shoeboxes filled with Subway receipts, I brought just one into my new place. I saved the moving receipts, of course.