Creating a System of Personal Finance Records – Textbook Personal Finance

This post is part of the textbook personal finance series which covers basic personal finance skills by going through an actual textbook, chapter-by-chapter. Check out the intro post for more information.

Last week, I wrote about creating a personal financial plan. The topic of today’s section is getting your financial records in order.

Having organized financial records puts you ahead on two fronts. First, until you have organized financial records, it’s hard to take the first step of creating a personal financial plan—finding out where you are.

Second, organized records aid your family and loved ones if anything happens to you. The mother of one of Micah’s coworkers was nearly kicked out of her nursing home because the son who handled the bills fell into a coma & the rest didn’t know enough about the info.

Filling Out the Financial Life Worksheet

Last summer, I put together a worksheet to store critical financial information for your family. You can download it here: [download#10#nohits]

In this post, we’ll be talking about storing data and documents that go beyond the one worksheet, items that back up the stored data. The book suggests keeping different information in different places. A home file which may be in folders, a cabinet, or a box. You can also use a fireproof home safe if you worry about fire or theft.

For critical documents, the book suggests using a safety deposit box. And thirdly, the computer is a great place to store information. Few people will have all of the documents listed below. These documents may also bring to mind other things you need to organize and store.

Documents to Keep in Your Home File

The book suggests keeping the majority of records in your home file. Since some of these contain sensitive information it’s important to keep the records somewhere away from easy access and prying eyes. Some of the things listed below may be things you receive in electronic format, in which case they’d fall into the computer storage category.

1. Personal and Employment Records
• Current résumé
• Employee benefits information
• Social Security numbers (and cards)
• Birth certificates
2. Money Management Records
• Current budget
• Recent personal financial statements (balance sheet, income statement, financial life worksheet)
• List of financial goals
• List of safety deposit box contents
3. Tax Records
• Paycheck stubs, W-2s, 1099s
• Receipts for your tax-deductible items
• Records of taxable income (printed freelance spreadsheets)
• Past income tax returns and supporting documents
4. Financial Services Records
• Checkbook & unused checks
• Bank statements
• Savings statements
• Location information and number of safety deposit box
5. Credit Records
• Unused credit cards
• Receipts & monthly statements (if you get in paper)
• List of credit account numbers and telephone numbers of issuers (in case cards are stolen)
6. Consumer Purchase and Automobile Records
• Warranties
• Receipts for major purchases
• Manuals for major appliances
• Auto service and repair records
• Copy of auto registrations
• Auto owners manuals (if not in car)
7. Housing Records
• Lease (if renting)
• Property tax records
• Home repair and home improvement receipts
8. Insurance Records
• Original insurance policies
• List of insurance premium amounds and due dates
• Medical information and bills
• Claim reports
9. Investment Records
• Records of stock, bond, and mutual fund purchases and sales
• List of investment certificate numbers
• Brokerage Statements
• Dividend records
• Company annual reports
10. Estate Planning and Retirement Records
• Will
• Pension plan information
• IRA statements
• Social Security statements
• Trust agreements

Documents to Keep in Your Safety Deposit Box

These items are more valuable and potentially harder to replace.

1. Identification and Insurance
• Birth, marriage, and death certificates
• Citizenship papers
• Adoption, custody papers
• Military papers
• Copy of will
• Serial numbers of expensive items
• Photographs or video of valuable belogings
2. Savings, Investment, & Credit
• Certificates of deposit
• List of checking and savings account numbers and financial institutions
• Credit contacts
• List of credit card numbers and phone numbers of issues
3. Ownership
• Mortgage papers, title deed
• Automobile title
• List of insurance policy names and company numbers
• Stock and bond certificates
• Rare coins, gems, stamps, and other collectibles

Documents to Keep on Your Computer

This is really a short list, reflecting the books early 2000s publication date. You can also keep scans of items such as warranties, tax records, etc, on your computer—though they may have less legal standing than the originals.

1. Past and current budgets
2. Summary of banking transactions (can be downloaded from most bank websites)
3. Past income tax returns if done on computer
4. Account summaries and performance results of investments
5. Files with wills, estate plans, and other documents

Personal Finance System

Rounding up these documents makes you life far easier than leaving them in multiple places around your house. It pays off at tax time, in particular. Next week’s topic is creating a personal balance sheet.

How do you organize your financial records? Do you think that the book’s advice on where to keep what is sound, or would you suggest some changes?

Print Friendly