Don’t panic. You’re going to be ready for tax season. We are going to give you the best tips and best products to ensure you never have to file an extension again! It will require some discipline and motivation. But we know you can do it.
Step One – Gather ALL Paperwork
Unopened/opened mail, the pile on the dining room table or any paperwork stuffed in a drawer or bin. Gather it ALL and put it in one place. Choose a spot where you can spread out, sort into piles, and can keep messy for a little while. You’ll want to be able to leave the piles and come back to them as time allows.
Step Two – Get Cozy
Choose your playlist, make coffee or tea, or put on your favorite Netflix series. Make the chore of sorting feel like less of a chore by pairing it with something you enjoy.
Step Three – Sort Papers
Create piles using the broad categories listed below. You aren’t labeling folders or filing away paperwork yet. Just piling. You can get more detailed later. If you come across action items (i.e. bills to be paid, calls to make, events to calendar) put those pieces of paper on top of their pile or create an “action” pile. Now is not the time to get bogged down. Make quick decisions and stay focused on sorting.
Make the following piles:
- Medical – EOB’s, Medical Bills, Prescriptions, test results, Insurance, etc.
- Home – home insurance, mortgage, rent, receipts for home repairs, etc.
- Utilities – gas, water, electricity, trash, etc.
- Auto – car payment, car insurance, car title, etc.
- Banking/Credit Cards – bills, statements,
- School – homework, IEP’s, contacts, etc. and/or student loans, financial aid, college applications, etc.
- Vital Files – passports, marriage license, birth certificates, etc.
- Investments/Retirement – statements
- Tax – W2’s, personal property tax, financial aid statements, end-of-year statements for investment/retirement, childcare receipts, donation receipts, etc.
- User manuals/User Guides/Warranties – small kitchen appliances, lawn care equipment, etc.
- Memorabilia – cards, handwritten notes, photos, ticket stubs, etc.
- Old – any paperwork over 12 months old
Once you have all the documents sorted you have options.
Option One – Create and label folders using broad categories you already created. Yup! You don’t have to sort any further. Don’t overcomplicate the file system. How often are you accessing files now? Is it worth making a super fancy system if you only need to access files once every few months? Think more about the ease of storage than the ease of retrieval.
Option Two – Purge and start accessing bills and accounts online. A lot of documents can be sent via email and reduce what mail comes into the home. You may find you don’t need many file folders at all.
Option Three – Keep sorting further. For example, break down medical into subfolders. One for each person in the home if that makes sense for you. Create a folder for insurance policies, EOB’s, test results, etc. Create subfolders under utilities for each utility type. School can be further sorted by child.
Here are some products we use when we organize paperwork for our clients. Click an image to see more color options and purchase.