What to Shred and What Not To Shred

Cleaning Up

Do you ever wonder what you can send through the shredder?

According to the Environmental Protection Agency, each year Americans dispose of more than 292 million tons of trash.  Additionally, we recycle 94 million or so more.  

And, if your house is like mine, we give a minivan load of stuff to Goodwill at least twice a year. And still it grows. But at least in the financial arena, it doesn’t have to be that way.  

Take it from some certified financial advisors, you don't need to keep every single piece of paper.

In fact, most of us keep far too many financial papers, including mutual fund statements, old bank statements, old insurance policies, and back taxes for years or even decades longer than necessary. 

Avoid Identity Theft

However, with the ever-increasing prevalence of identity theft, the proper destruction of records has become critical.  

Don’t put yourself in the position of being a victim.  Shred or destroy all documents with personal information. Never put non-shredded documents out for curbside recycling!

In the tax and financial world the rule is, when in doubt, keep it.  Now regarding all the other paper that swamps our lives, check out the following list of suggestions for what to keep and what to destroy.  

And, as always, feel free to contact us with your questions and concerns.

 

WHAT TO SHRED:

​Insurance papers

Don’t throw out policies until they have been lapsed for over five years because many life insurance policies may be reinstated within five years, depending on your current health condition.  

You should always keep current insurance policies and old annuity policies that were rolled into new policies.  You could be asked to verify your original cost basis, which the old annuity policies will state.  

Car and home insurance policies generally renew every six months, so you can throw away the old policies and replace them with the new.

​Investment statements

Most companies provide annual statements that contain all the transactions for a whole year.

If so, you can comfortably throw away all quarterly, monthly and transaction confirmation statements.  If there isn’t a year-end statement, you should keep all of them.

​Tax and bank statements

The IRS can audit your returns for up to six years, so many CPAs suggest that you keep your tax returns for that long. 

However, if you have a home or investments, such as stocks or a business, which you have held for longer than six years, then you will want to keep your returns for as long as you have held the investments because each tax year is linked by those investments.  

Bank statements and reconciled checks should be kept for the same six years, but again, if you have a year end consolidated statement of all transactions, you can shred all monthly statements.

Other Documents

  • Address labels from junk mail and magazines
  • ATM receipts
  • Bank statements
  • Birth certificate copies
  • Canceled and voided checks
  • Credit and charge card bills, carbon copies, summaries and receipts
  • Credit reports and histories
  • Documents containing maiden name (used by credit card companies for security reasons)
  • Documents containing names, addresses, phone numbers or email addresses
  • Documents relating to investments
  • Documents containing passwords or PIN numbers
  • Drivers licenses or items with a drivers license number
  • Employee pay stubs
  • Employment records
  • Expired passports and visas
  • Unlaminated identification cards (college IDs, State IDs, employee ID badges, military IDs)
  • Legal documents
  • Investment, stock, and property transactions
  • Items with a signature (leases, contracts, letters)
  • Luggage tags
  • Medical and dental records
  • Papers with a social security number
  • Pre-approved credit card applications
  • Receipts with checking account numbers
  • Report cards
  • Resumes or curriculum vitae
  • Tax forms
  • Transcripts
  • Travel itineraries
  • Used airline tickets

 

WHAT NOT TO SHRED:

  • Original birth or marriage certificate
  • College transcripts and diplomas
  • Divorce decrees
  • Current passports
  • Mortgage documents and real estate deeds
  • Vehicle titles
  • Education or military records
  • Social security cards
  • Life insurance policies
  • Wills and trusts
  • Powers of attorney
  • Unexpired warranties
  • Credit cards
  • Binders
  • Floppy disks
  • USB drives
  • Hard drives
  • CDs

 

Hopefully this article has given you some direction on what you need to hang on to and what can go. If you thought this was helpful, you should contact one of our certified financial advisors and see what we can do about your finances.

 

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At Medallion Financial Group, we believe financial planning is about Family. We have been helping families invest in the future since 1987 through a holistic planning approach. We recognize there are a variety of needs when it comes to retirement planning, plan rollovers, annuities, college planning, life insurance options, and investment management. It is easy to get lost in a sea of choices. Our financial advisors help with the basics and beyond to enable our clients to get the education, advice and management they need to retire with confidence.

Our focus is twofold: first and foremost, we are fiduciary advisors. We stand against any violation of laws, values, and ethics. Second, we treat our clients as part of our family, not only those who call Maryland and Georgia home, but clients across the US who have benefited from our reputation of personal service, integrity, and expertise.

We strive to exceed client’s expectations – because we have high expectations of ourselves.