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Thursday, January 3, 2013

Thrifty Thursday - Out with the old, in with the new

January usually means getting my finances in order.  My college-age kids want to get their FAFSA applications (financial aid) submitted to their schools early, taxes need to be completed, and last year's bills and receipts need to be put away to make room for this year's financial papers.

So, yesterday I worked on my filing system.  One thing I learned years ago was to keep my files simple.  The more complicated they are, the less I use them.  Why make things harder than they need to be?  I also don't worry about making fancy labels or decorating my files to be Pinterest worthy  :)  They're going to be shut up in a drawer.  Functional is fine with me.

So, I start January with labeling new file folders for the new year's receipts.  I will keep 2012's around until I complete taxes for last year but I don't want to mix up 2012 with 2013.  Each category of folder is fairly broad.  The Automotive folder holds receipts for repairs and maintenance.  The Utilities folder holds receipts for electric, heat, garbage, phone and cable.  Other categories are Contributions, Bank, Insurance, Investments, Medical/Dental, Business, Home Improvement, and Education.  I also keep ongoing file folders for important medical information, past tax returns, equipment manuals (staple the original sales receipt to the front of each manual), and insurance policies.

One thing that is fairly common is to keep too many receipts.  In general, you only need to keep receipts and records that you will need for preparing taxes.  For most of us, that means you don't have to keep grocery receipts, gas receipts, receipts for household items and clothing...unless any of these are part of your work or business.

I'm not an accountant or professional financial planner so if you need specific information or you have unique situations, talk with a professional or read up on the subject.  But everyone, regardless of situation,  needs to take some time in January to get their financial paperwork set up for the new year.  Better earlier than later!


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