How Long to Keep Documents: From ATM Receipts to Tax Reports

We rarely think about how to keep our documents. Who cares anyway? As long as they are there when you need them, you’re good.

Funnily enough, it’s the opposite.

Haven’t you ever been looking for a document for hours? You even saw where it was a few days before. So where do you look next?

In most cases, you luckily find them. But it’s not worth going into all that stress. Documents should take seconds and not days to organize. And the more important they are, the more accessible they should be.

Oftentimes, we worry about what data we need for this or that paper. But missing documents is the most common problem. Two reasons:

  • Because they are so important you keep all of them. But because you have so much paper, you don’t know where to look
  • Or you throw away reports without first wondering when you may need them again. And the moment you need those, you don’t know where to get them

There are papers you should never keep, others to throw away next week, and others you will keep for a lifetime. Depending on the usage, you organize differently.

10 Types Of Documents And How Long To Keep Them

Documents And How Long To Keep Them

The most important documents are the ones you need to keep the longest. So let’s start with those:

#1 Portfolios and Academic Certificates (forever)

Imagine this:

You get a job offer, and the employer wants to check your professional background. You’ve spent years of your life studying in college and getting experience in other positions. You clearly have the knowledge and skills for this opportunity.

But as much as the employer wants to trust you, their boss won’t accept a candidate who doesn’t have proof of those accomplishments. It’s just too risky for the company to hire someone with no guarantees.

Maybe you get the position, maybe you don’t. But these certificates will secure you more jobs in the future. If you already did all that work, why not have the documents?

Why It matters:

Even when certificates don’t determine your job success, they help for credibility. When you’ve invested your time in college and work experience, you want to take advantage of those warrants.

As a professional, the portfolio shows what you’ve achieved with other clients. Without one, there’s no way to know if you’re going to deliver.

Here is how you can create an amazing portfolio to wow your job interviewer.

Keep these documents as long as you value new work opportunities, at least, until you retire.

#2 Vehicle Documents (forever)

Imagine this:

You’re a habitual driver who always carries the important papers. But one day, someone somehow steals your car with no clues to find it.

Not only that, but you lost your certificate of conformity, proof of insurance, registration, roadworthiness certificate, and other vital documents. Maybe you also kept there the car title, which should instead be hidden in some safe box.

There’s not much to do if you lost the original documentation. But with a lot of time and money, you could get them back.

The police may eventually find the vehicle. But even if they don’t, you still keep the ownership and documents.

It’s quite common among scammers to sell used vehicles they don’t own. They say they’re selling it for a friend, when it’s really a used car scam.

Why it matters:

Without this proof, it can be hard to get repairs or sell your car. The police may stop you and ask about it for some reason. And you could lose your car if you can’t show them what they want.

It’s not all lost if you throw them already, but it’s time-consuming to create new ones. Instead, make copies and keep them in different spots. And your title should NEVER be in the car.

#3 Guarantee Certificates (forever)

Imagine this:

You’ve been using your new computer/phone/camera/appliance/device for many months already. But right when you least expect it, a component breaks. Or it stops working for no reason, and you don’t know what to do.

You Google how to fix it, but nothing happens. After the frustration, you assume the only way to fix it is to pay for a repair. So you search online, find a repair store, and contact them.

The owner tells you to bring them the device, preferably with everything it came from the store. The more components, the better.

You bought it in less than a year or two. And after looking around the rooms, you find the box. You open it, and there’s a document. It offers a free repair guarantee for the first four years.

It seems you’re still on time, so you go to the original store instead, where they gladly repair the device.

Why it matters:

You never know what can go wrong, even when you buy items in new condition. If quality is unreliable, or you use them the wrong way by accident, the worst may happen.

If you keep the packaging/manual, always keep the guarantee nearby. Some sellers offer two-year guarantees and others for a lifetime. Sometimes, they aren’t free, but you can keep a repair discount forever.

In any case, you can’t get support without the guarantee certificate. It’s too risky for the company due to the many refund scams out there.

#4 Medical Reports (7+ Years)

Imagine this:

In the worst-case scenario, there’s something wrong with your health, and you need immediate assistance. But because hospitals are so busy this year, yours isn’t available.

So they send you to another one instead. They diagnose you and recommend what to do. But they need your medical reports to treat you. Otherwise, they might worsen your condition. But once they know your reports, the doctors can treat you the right way.

After that, you show these reports to your healthcare insurer. So they know what they have to pay and what they don’t.

Why it matters:

Medical documents will be important as long as you benefit from healthcare services. In case of emergency, your familiars and you should always have them available both on paper and virtually.

These reports also protect you from healthcare fraud. Say a dishonest employee wants to charge you for a treatment you didn’t receive, or they changed the price without consent. You can now request a refund.

#5 Tax Return Documents (7+ Years)

Imagine this:

As a responsible worker, you keep your documents organized, save money, keep your credit score high, pay on time, and increase your income.

You don’t like to keep too many files because it’s confusing. And you paid the IRS this year already. So there’s no point in keeping those return statements. You throw them away.

Tax season arrives next year, and you do the same. You do your taxes, file, and get rid of the needless paper. There’s nothing wrong with that.

But for some reason, Uncle Sam thinks you’re misrepresenting your income report. They have their reasons to distrust, and the IRS is requesting you a tax return you filed five years ago.

Because you don’t have proof, you can’t prove them wrong. You pay the unfair penalty.

Why it matters:

If they believe you underrated your income by 25% or more, the IRS has 6-7 years to audit your report (3 years max for good-faith errors). You need to keep those tax return files to prove that no such error exists.

Otherwise, they may penalize you for tax evasion.

#6 Receipts (variable)

Imagine this:

It’s the end of the month, and you have a lot of payments remaining. You check your account, and you’re surprised to find a low account balance. Where could all your money go?

It would be easy to know if you took 1-2 hours a month to do personal accounting. But because you didn’t keep the receipts, you have no idea of what you spent.

You also remember spending $100+ on an item you didn’t really need. Because you’re short on cash, it would be smart to return it, and maybe buy it later. But you threw away the receipt seconds after the purchase, so there’s no chance for that.

Why it matters:

Most of those have a 30-day refund guarantee. They will return your money if you come with the item and the receipt.

It’s not only for items you don’t want. It’s mandatory when the seller overcharges you by mistake, or you pay for products you didn’t buy. With so many customers buying from them, you won’t get a refund without a receipt unless you come back within two minutes.

When buying from supermarkets, keep receipts for one month, do the accounting, then throw them away. For expensive items, keep them for 30 days.

#7 Bank Statements (1 Year)

Imagine this:

You want to register on some website involving money. Maybe it’s an investment program, a Fiverr-type platform, or an online bank. Whether you want to make or save money, you need to pass KYC to use their service.

By law, you can’t work with users who don’t prove their identity. But that’s not a big deal for you, because you always keep the ID card nearby.

The second step is the proof of address. And depending on the platform, bank statements may be your only option. They request a file that clearly shows your bank number, legal name, address, official bank name, and a record of your transactions in the last 90 days.

Thankfully, bank statements are free and easy to get online. But if there’s a mistake, the yearly statement used for taxes could be different from your quarterly statements. If you didn’t keep copies of those, you can’t request a correction.

Why it matters:

Other than verification purposes, we use bank statements for data entry. Keep the quarterly reports to do the numbers at the end of the year. Only if they match, you can tear them down. If there’s an error, you need this proof to avoid overpaying the IRS.

Once you no longer need them, destroy the documents. If not, old-school thieves may find those papers in the garbage bin, thus finding your sensitive information.

#8 Pay Stubs (1 year)

Imagine this:

You work with an employer who isn’t very organized. There are too many employees, the company is too big, or the state laws are complex. Which means your boss can easily make mistakes.

These will cost you money unless you point them out. When getting the pay stub, both the worker and employer get the record. If one of these gets lots, you still have the other one to correct.

In another example, you may be applying for a loan. But the lender doesn’t want to risk money on a stranger, so they ask for some proof of income. Because your pay stub matches with the employer records, you verify and get the loan approved.

Why it matters:

These reports contain critical information: identification, gross wages, taxes/deductions, and net pay — how much you take home.

Aside from verifying your income, pay stubs are convenient to track your taxes. If you file, but the IRS thinks you’re not paying enough, you can use these stubs as proof.

#9 Retirement Plan Statements (1 year)

Imagine this:

You just got a good job position, and you believe your income will increase in the future. This is the best scenario to invest in a Roth retirement plan (check our investment strategies guide). Why?

Because you can pay taxes now while you’re in a low bracket. And you won’t have to pay them when your money compounds/multiplies. More taxes mean slower funding, but because you can earn more money, that won’t be a problem.

What you plan is one thing, and what the IRS thinks is a different one. You’d better keep those retirement statements, or they may make you pay AGAIN for taxes you already made. You know: if they can’t see it, it didn’t happen.

You don’t want to find out decades later that you need to pay taxes after paying them for so long already.

Why it matters:

We understand the low likelihood the IRS makes a mistake. But you only have one chance in life to earn for retirement. So it makes sense to prepare for even the most unlikely events. Make sure nothing ruins your well-deserved retirement.

If you haven’t received an annual statement yet, keep your quarterly retirement statements until you check them. If everything looks good, shred those papers. As for the annual reports, keep them until you retire, so you can prove to Uncle Sam that you paid every cent.

#10 Utility and phone bills (1 month)

Imagine this:

You get your utility bills like any other month, and you believe there’s no point in keeping them. You’ve accumulated dozens of those already, and the company must have copies of these anyway.

But what if they double charge you? You just lost money for an error.

What if you did the payment right, but they didn’t receive it? They send you the invoice again.

If you pay your renter to pay those utility bills, it gets more muddled. Rent is every month, but utilities may bill every two or three months. It’s confusing for the renter to know whether you paid for it or not. So unless you keep those bills, you might need to pay them again.

Why it matters:

If you keep your bills for a month, you can then check them in your monthly statement. If everything looks good, then you throw them away. If you think the company overcharged you, you can get a refund only when sending this receipt.

If you need these for tax purposes, it’s better to keep them for the whole year.

How to Organize Your Documents

How to Organize Your Documents

Great. Now you’re sure you’re only keeping important documents in your personal office. But that doesn’t mean they are easy to access. You may still have hundreds of vital reports that you should never throw away.

Unless you have a system to access them easily, it’s the same as if you didn’t have them.

Finding your documents shouldn’t be a two-hour dreaded task. With simple organization tips, it won’t take you more than a few minutes every time. Here are the basics:

Organize by function

Even if you know how long to keep each file, it’s still confusing to know why you need each of them. That’s why it’s a good idea to categorize by purpose. You can either use three different file holders or add labels to your documents.

  • Vital files: You will ALWAYS need these certificates for verification purposes. Always keep them easily accessible yet secure. If possible, avoid using the original files.

You will likely need these for the rest of your life. And replacing lost original files is nearly impossible, if not a hassle. These include your passport, residence permits, SSN, birth/marriage certificate, among others.

Some vital documents require periodic renewal. Expect the unexpected: renewing could take longer than planned, which might leave you with no documents for a while. To avoid that problem, apply six to twelve months before the expiration date.

  • Data entry: You keep data entry files for accounting and tax purposes. Every month/year, you get a summary of your income/expenses. Only throw away these files after you double-check with the general report.

It could be as tiny as an ATM or grocery receipt. Or it could be utility bills and pay stubs. These help you verify expenses and do personal accounting.

  • “Action” documents: You need to complete some tasks involving these papers, such as filling up some data, attaching documents, providing them in some office, things like that.

It helps to place a label saying what you need to do, when, and where. Also, set an alarm on your calendar the day before to make sure you prepared them.

After you complete the action, review whether you still need the document or not for data entry purposes. Otherwise, throw it away.

Organize by duration

You may have hundreds of documents in your drawers. But it’s not as overwhelming if you know which ones to pay attention to and which ones to ignore.

  • Long-term/permanent documents are typically the most important. Keep them in a safe place you can easily remember. Their common purpose is vital/data entry.
  • Reserve a drawer for yearly documents. Consider it a place where you simply drop important documents every month. There’s no need in inspecting this place until the end of the year unless some accounting issue requires it.
  • Keep the monthly folder next to you. Include utility bills, purchase receipts, and action-type documents. Because you’ll dispose of all of these by the end of the month, it helps to use labels and subfolders to know what to do with each group.

All you need to think about is the monthly folder. Keep adding reports to your one-year drawer, and only access your vital files when requested.

Keep copies in different spots

When having dozens of vital documents, you will likely lose one at some point. And you won’t know what you lost until the day someone asks you for it.

Papers get lost all the time, but if you only use copies, you can see which ones are missing. Make one or two copies so you never need to use the original ones.

Sometimes, losing the document isn’t the problem. But you can’t access them anymore or you forgot where they are. That’s why we keep copies in different places: maybe one in the office and another one in the car.

Get a safe box/ waterproof or fireproof wallet

It’s really frustrating to lose documents for causes external to you:

  • You allowed someone to use them, but they didn’t put them back in the same place
  • There’s a fire in your place. While you escaped, the valuables you left behind are destroyed
  • Someone steals your documents

Now that you organized your files, it may be time to invest in security. Safe boxes are ideal, but you can also use special bags, which are fireproof, waterproof, RFID-protected, even bulletproof!

The news bags may have chips, so you can find where the folder is by logging into your mobile app.

Move them online and offline

Physical offices take too long to organize, and security can be expensive. It’s much cheaper and faster to go digital and reduce your load.

Most verification processes are online, so don’t keep any physical documents unless they’re original and unrepeatable. For everything else, just scan them and put them in a virtual folder.

You can also save them with cloud services to access these anywhere. But if you want something more secure, use a hard drive device.

That will replace most files you keep in the one-year drawer. As for the monthly receipts, there are too many, it takes too long, and they aren’t very relevant. Keep them in paper instead.

For verification, many will ask you to send a screenshot of your vital documents. You can do that now and save them in a folder, so you don’t have to do it again.

Make an inventory of your documents

If you’re in a hurry, you don’t have time to open the drawer and start looking at what you have. When storing documents for different purposes, a checklist will help you to find them.

If you want document X, go to X subfolder in the X drawer. You’ll always know what you have without having to look up.

This can get complex, so start your inventory from the most to the least important. If you have too many receipts, you can just write it down as a category: grocery purchases, products to return, monthly bills.

Know What to Do With Future Documents You Receive

What to Do With Future Documents

You now have everything organized. But how do you prevent this mess from happening again? You need a system to know where to move every paper you receive in the future.

Ask yourself first: Do I need to keep this document? What would happen if I threw it away?

Next, you label based on its purpose: certificate/data entry/action. For the last group, clarify what to do, when, and where (set a reminder).

Update your inventory list and place the document in the right folder: monthly, annual, or vital.

That’s it. You no longer need to clutter your mind with reminders. The system does it for you. If you do it right, this process will only take a few minutes every time, which gives you mental clarity.

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