Financial organization is a cornerstone of a healthy financial life. At the most basic level, financial organization saves time and money because it aids in paying bills on time, being able to find needed documents during tax season, providing proof of payment, disputing credit card billing errors and avoiding the stress of dealing with piles of unorganized bills and paperwork.
It also sets the stage for better financial decisions surrounding investments, budgeting, debt and investment planning. Financial organization improves your working relationship with your financial advisor, because there will be less time spent looking for paperwork and more clarity around the overall financial situation, leading to more informed decisions about your investments and financial plans.
While having a system to organize financial paperwork is important, it is not important which system is followed but that a system exists. In most cases, a combination of electronic and paper filing systems will do the trick.
For couples, clearly establishing responsibilities for financial matters is an important priority. If one spouse manages the finances, the other spouse should be informed about what is going on financially, where important documents are stored and the passwords for all online accounts.
What documents to keep and what to toss is another important part of becoming better organized. The IRS recommends retaining tax returns and any documents that support tax returns for seven years. Other documents such as paper bank statements, investment account statements and credit card statements can be shredded after a year, especially if they can be accessed online in the future if necessary.
Financial paperwork generally falls into the following categories: investments, taxes, credit cards and loans, college savings, retirement savings, insurance and estate planning.
Let’s start the New Year with an Organized Financial Life!
Reesa Manning is Senior Vice President and Financial Advisor at Integrated Wealth Management, with an expertise in investment, retirement income, and financial planning. For more information, call Reesa at (760) 834-7200 or reesa@IWMgmt.com.
The above is being provided for informational purposes only and should not be considered investment, tax or legal advice. The information is as of the date of this release, subject to change without notice and no reliance should be placed on such information when making any investment, tax or legal decisions. Integrated Wealth Management obtained the information provided herein from third party sources believed to be reliable, but it is not guaranteed. Form ADV contains important information about the advisory services, fees, business, and background and the experience of advisory personnel. This form is publicly available and may be viewed at adviserinfo.sec.gov