How to Organize Important Documents at Home (2019)
Paperwork can be overwhelming.
Especially when it starts piling up.
That’s why, in today’s post, I’ll help you organize the important documents you’ve got at home.
I’ll also share some tricks to make sure it stays organized.
Let’s jump right in.
Make a Game Plan for Organizing Your Paperwork
Set some intentions before you begin organizing your paperwork.
• How much paperwork do you want to get rid of?
• What kind of documents will you keep?
• How will you get through it all without burning out?
These are all important questions to take into consideration, especially if you have a lot of paperwork to go through. Set goals for yourself, decide beforehand what you’ll want to keep, and think about ways you can divide up the work into manageable chunks. This will help you stay focused throughout the organization process.
Understand Which Documents You MUST Keep
Chances are, you have a lot of documents that you don’t need. Paperwork that is taking up space and making it harder for you to stay organized. Before you start getting rid of things, however, make sure you’re keep the absolute essentials.
In his record retention guide, financial expert Dave Ramsey recommends that you keep the following documents indefinitely:
Use this list as a guideline, but not as an absolute. If there’s something you’re uncertain of whether you should keep, keep it. It’s always best to err on the side of caution when it comes to your important documents at home.
Gather Your Documents and Sort Them Into Categories
Find an open space in your home where your paperwork won’t be disturbed, stepped on, or otherwise soiled. You’ll want to make sure you have plenty of room to move around comfortably.
Next, dedicate an area in your open space for each of the categories listed below. Create a label to mark each category. Then, sort all your documents accordingly:
1. Auto (contracts, insurance, maintenance, etc.)
2. Bills (electric, utility, internet, cell phone, etc.)
3. Career (employment contracts, certificates, etc)
4. Education (diplomas, transcripts, awards, etc.)
5. Financial (bank statements, receipts, etc.)
6. Health (bills, reports, diagnoses, vaccinations, etc.)
7. Immigration (visas, applications, etc.)
8. Pets (vaccination, adoption papers, etc.)
9. Property (contracts, insurance, mortgage, etc.)
10. Taxes (charity receipts, W-2, tax returns, 1099-INT, etc.)
11. Vital documents (SSN, birth certificate, will, etc.)
12. Other (important documents that don’t fit into a category)
13. To-be-shredded (documents with sensitive information)
14. To-be-recycled (documents without sensitive information)
This might take some time, but make sure to sort it properly before moving on to the next step.
Scan and Digitize the Documents You're Keeping
Once you have all your paperwork organized by category, make a digital copy of everything. This can be quite the endeavor if you don’t have a scanner that automatically feeds documents, but there’s a good chance your local library has one you can use. Bring your documents, a flash drive with enough storage space, and some patience.
After everything has been scanned, upload your documents to your computer and organize them using the same categories you used to sort your physical documents.
Keep a backup of everything on your local drive. Avoid using cloud services like Google Drive and Dropbox for your sensitive documents due to risk of hackers as well as other privacy concerns.
Now that you’ve digitized your papers, you can begin moving some more documents to your trash or shred piles. For example, you don’t need to keep physical records of your bank statements if you have digital copies as well.
This makes organizing your paperwork in the next steps a lot easier. Just make sure you don’t shred or throw away any original documents or paperwork containing original signatures, stamps, or seals.
Shred or Recycle Any Documents You’re NOT Keeping
Shred all documents that contain any personally identifiable information, such as social security numbers, bank information, and addresses. If you don’t have a shredder, AmazonBasics has a high-rated and affordable cross-cut shredder that lets you shred 12 documents at a time.
Otherwise, you can take your documents to a shredding service near you. They charge around $1 per pound of paper (one pound equals approximately 100 sheets of paper).
You’re safe to discard anything that doesn’t have personally identifiable information. And remember, paper is recyclable.
Make Your Vital Documents Disaster-Proof
Vital documents are the original forms of your social security card, passport, birth certificate, marriage certificate, will, adoption papers, original immigration paperwork, vaccine information, and other similarly important documents.
We highly recommend that you prepare for the worst by protecting these documents from disasters like floods and fires. If you have a safe, you’ll want to put these documents in it. At the very least, invest in a fire- and waterproof documents bag. It’s an affordable insurance against some of the worst disasters.
Organize Your Documents Into Folders or Cabinets
Next, get an organization folder or file cabinet. The option that is right for you completely depends on the amount of paper you’re organizing.
Here’s what I recommend based on the number of sheets of paper:
For 0-900 sheets of paper, use an expanding organizer file folder.
For 900-3,000 sheets of paper, use an accordion organizer file folder.
For 3,000+ sheets of paper, get multiple of the organizer files mentioned above or consider using a filing cabinet.
That being said, if you have 3,000+ sheets of important documents, it probably means you’ve got some documents that you don’t need to keep or that you can consider moving strictly to your digital folders.
Once you have something to organize your paperwork in, separate your documents into the 11 categories listed below. Put them in alphabetical order and organize each folder by date (put the most recent documents in the front).
As a reminder, the categories are (in alphabetical order):
You also have a separate category of your vital documents, but these should be stored somewhere safe and disaster-proof, as I mentioned in step 6.
Take Steps to Make Sure You Stay Organized Over Time
You made it. You’ve categorized your important documents, (hopefully) weeded out a bunch of unnecessary paperwork, and you’re most likely feeling exhausted.
There’s still one small step left to this process, however, and that is to make sure your important documents stay organized.
Keep reading for some of my best tips and tricks to help you stay organized in the longer term.
Scan and organize new important documents frequently
Inevitably, there will be more important documents that need to be organized. Pick a day (monthly, perhaps) to go through the pile of new documents and scan them to their appropriate folder on your computer. Then, depending on the documents and your style, either shred them, recycle them, or file them in your folder or cabinet.
The best thing Ayla and I did to go paperless was to get the Doxie portable scanner. This little wonder is completely portable, wireless, and doesn’t need a computer connection (everything is scanned onto an SD-card reader). We keep it handy and scan all new important documents within seconds of receiving them (it also works great for scanning photos). Once a month, we upload our scanned files to their appropriate folders on our computers and flash drives.
Sign up for paperless statements and bills
Your utility company, phone carrier, bank, and other service providers likely provide the option to receive your statements and bills electronically, either by email or through an online account. This is an easy way to keep things digital and reduce your environmental impact. Just log into your service provider’s website and look for the option to opt in for e-statements.
Opt-out of direct marketing mail using DMAchoice
DMAchoice is a service that removes your address from the direct mailing lists marketers use to send you advertisements. This might help you reduce the amount of junk mail you get so you can focus on the documents that really matter. It costs $2 to register your name, and it lasts for ten years.
I hope that helps!
Let me know if you have any other questions about organizing important documents at home in the comment section below.
Until next time.