You probably experience this year after year - you think you're ready to file your taxes, but finding them and ensuring you have what you need is difficult and time-consuming. If your tax preparer spends more time sorting through your receipts and documents than preparing your taxes, you have a problem. Why not get started off on the right foot for next year?
When it comes to setting up a system, simpler is better. But, simpler does not mean everything thrown randomly into a cardboard box - or a plastic bag (yes, I've seen this)! If you create a storage system that is too complex, you won't use it. It becomes cumbersome to file anything away, so you resort to the box method. One of the better methods that works for most people is either a very small file box with hanging files, or an accordion file folder. The one listed below is great because it closes, has enclosed sides and is very portable. Or, if you need something that's heavy duty, choose the plastic banker's box style.
Aim to have only 7 or categories, as you may find it too difficult to manage if you go beyond that. For example, instead of having separate files for your retirement account and your non-retirement related investments, it might make sense to combine those into one file, just labeled investments.
Speaking of labels, be sure you do label your tabs or folders. It does no good to come up with categories if you don't clearly label things. Trust me, I know people who don't label... and they end up getting very confused. When you only have a few categories, labeling can be quick. Labels can be as simple as a post-it note stuck on the tab, or as fancy as a machine made label. Whatever works for you is fine, as long as the label doesn't fall off and is clear to you what is contained in that file.
So, do yourself a favor for next year and get this ready now. It will only take you a few minutes, but save you a ton of time next year. If you aren't sure how to get started, get in touch. I'm happy to help!
Jennifer Raschig loves to share thoughts on creating restful spaces and presenting your best self every day.