|Organizing A Home Filing System|
|A system for personal records is a necessity. No matter how modest your home facilities might be, you need a special place to keep your papers. That could be as elaborate as a room or home office or as simple as a corner of the kitchen, bedroom, or hall. Records, regardless of the filing system used, should be reviewed at least once a year to discard items no longer needed. January is a good time for an overhaul, since it’s just before you begin to work on taxes. |
The equipment you will need doesn’t have to be elaborate. Think about a filing cabinet before you think about a desk. The
|two-drawer type can be covered with paint or wallpaper. A wooden slab or hollow-core door stretched across the top of two cabinets can make a practical home office desk. If you don’t have space for a small cabinet, buy accordion folders, a storage chest that fits under the bed, or get sturdy cardboard boxes of an appropriate size. |
A home computer or portable typewriter and a pocket calculator can be handy, but they are not essential. The essential thing is to know where everything is.
What to Discard
|When was the last time you couldn’t find an important paper you knew you had carefully put away someplace? How much time do you spend trying to straighten out your household business affairs, especially at income tax time? How, in fact, do people decide what records are important to keep and what they can discard? How do they decide where to store and keep such records and papers? |
Even though each family or household must work out its own system, some general guidelines can be helpful. As a starter, ask yourself a few questions:
|Keeping Tax Records|
|How long should you keep tax records? The Internal Revenue Service has 3 years in which to audit Federal income tax returns. However, this limit does not apply in unusual cases. If you failed to report more than 25 percent of your gross income, the Government has 6 years to collect the tax or to start legal proceedings. Also, there are no time limitations if you filed a fraudulent return or if you failed to file a return. But you don’t have to keep everything for tax purposes. You can lighten your record load by discarding certain checks and bills once they have served their purpose. For example, you can throw away weekly or monthly salary||statements—assuming you are paid in that way—after you check them against your annual W-2 Form. But save cancelled checks that relate directly to an entry on your tax return, and keep all medical bills for 3 years to back up your cancelled checks. The IRS generally keeps records for 6 years. You can obtain a copy of your tax return by writing to the IRS center to which your return was sent. Make sure you include your social security number and a notarized signature.|
|Making Household Inventory Records|
|Among your important papers keep a household inventory. If there is a fire or burglary in your home, this record will help you remember what has to be replaced and how much each item is worth. An inventory also may show that you need to increase your insurance because your possessions are worth more than you thought. The best way to go about compiling a household inventory is to start with a sheet of paper for each room in the house, apartment, etc. Forms on which to record items are available from several places, sometimes from your county Extension office. |
When you make your inventory, start at one point in the room and go all the way around, listing everything. For each item, list what it is, how much it cost, when it was purchased, and what it would
|cost to replace it. Include the model number, brand name, dealer’s name, and a general description. If you take pictures of the rooms and your household possessions, it will make identification or replacement, easier. Arrange expensive collections, silver, and jewelry separately and take close-up pictures. When you have finished all the rooms, including the basement, garage, and attic, add up the total replacement cost. That figure will represent what your household is worth and is what your insurance should cover. |
Update your inventory every 6 months or so by adding new purchases and adjusting replacement costs.
|Two Home Files|
|You should keep two home files, in addition to your safe deposit box at the bank. These two files are your active file and your dead storage file. Your active file will hold: 1) unpaid bills until paid, 2) paid bill receipts, 3) current bank statements, 4) current cancelled checks, 5) income tax working papers. After 3 years, move these items to your dead storage file. There are other items which should always be kept in your active file. These include: 1) employment records, such as resumes, recommendation letters, health benefit information; 2) credit card information, including the number of each card, by company name; 3) insurance policies; 4) copies of wills; 5) family health records; 6) appliance manuals and warranties; 7) education information, such as transcripts, diplomas, etc.; 8) Social Security information on benefits and regulations; and 9) an inventory of what’s in your safe deposit box (you might store a key in the inventory folder). |
Finally, keep a record book of the whereabouts of your important papers. If
|you use a loose-leaf binder, you will be able to change papers easily or copy a page or two. The book should contain a list of all your savings and checking accounts. This way you won’t become one of the missing depositors who have forgotten their accounts or who have died without telling relatives about them. Also, include the name and branch of the bank where you keep your safe deposit box. |
The book also should have all of the family members’ social security numbers, and all of the insurance policy information. It’s a good idea to keep a copy of your household inventory here as well. Don’t forget to record all your household improvements.
Finally, make sure someone else knows and understands the family record-keeping system.
|THINGS TO REMEMBER|
Use the checklist chart below to remind yourself what to keep and what you can discard.
|Safe Deposit Box|
All Active File Papers Over 3 Years Old
Items To Discard
|Preparing A Net Worth Statement|
|Have you tried filling out a net worth statement as a means of keeping tabs on yourself and your family possessions? Such a record provides a good overall picture and can be prepared in an hour or less. If you do it annually, you can see quickly whether you are getting ahead financially or falling behind and, in either case, how fast. An accurate net worth statement can serve as a point of departure for the year ahead. If you’re not making as much progress financially as you had expected to, you can decide whether to stay on course or to change directions for the coming year.||Where are you going to find a net worth form that will meet your needs? Try your county Cooperative Extension Service office. Or ask at your bank. Better yet, perhaps you can make one to fit your family. All you do is list your assets, list your obligations, and subtract the debts from the assets. Hopefully the plus side of the ledger will get larger each year and the minus side smaller. But there may be good reasons why you’ll fall behind sometimes, such as when you buy a new home or when other expenses are heavier than usual.|
Source : www.publications.usa.govHelmina Sinaga's Blog
Originally posted 2016-08-11 10:11:04. Republished by Blog Post Promoter