How to Start a Personal Filing System

I had a law school friend who was a few years older than me and who sometimes treated me like I was less of an adult than she because I was in my early twenties whereas she was nearly thirty.  I used to get annoyed and say, “I am so an adult!  I am married and I’m in the same school program as you!”

One time she clarified how I was still “a baby.”  She said: “Everyone has a moment in their life when they realize they are now an adult, and that there is no going back.  You haven’t reached that point yet, I can just tell.”

I wondered what her “moment was.”  I figured she meant something big like having children of your own or getting married.

Curious, I asked.

“What was your moment?”

“When I bought my own tooth brush.”

Sometimes I think she was right, that true adulthood is the moment you realize you can no longer rely on your parents or anyone else to perform and take care of the boring little “adult” things for you.

I thought of my friend’s line about two years later when I had my very own “I am officially an adult and there is no going back” moment.

 

I was at this point already married and well on my way to finishing up my law degree. However, it was not until I determined my wife and I needed to organize our personal records into a filing system that I knew I was truly an adult, and there was no going back.  For me, starting a personal filing system was no less a right of passage than graduating from college or even getting my first decent job.  While it may not rival going into the woods for a few days alone like some Native American tribes practiced as a right of passage, it meant for me that I had complete responsibility over myself, as every adult must.

Keeping track of my records is now not only something I get to do at home, but my job as an attorney requires meticulous record keeping as well.  I thought I would share my filing system because I found creating a personal filing system to be daunting the first time I attempted to do so.  I am not saying I have the best personal filing system, but I do think it will give an idea of one way to go about creating an effective filing system.

Starting a Personal Filing System

If you allow paperwork to pile up with no clear cut system in place, eventually tax season or something else will come along and make you pay dearly for your disorganization.  The more organized and systematic you are in your record keeping and filing system, the better off you will have it when those “taxing” moments arrive.  And trust me they will.

Again, the method I use may not be the greatest for you, but I find it personally effective.  You might want to talk with your accountant or another appropriate expert before starting your own personal filing system.  Also, the below system assumes you are starting from scratch.  With those caveats in mind, here is how my wife and I have constructed our own personal filing system:

Starting a Personal Filing System Step 1: Gathering All Your Important Documents

It is time to clear off what used to be a dining room table.  To dig out paperwork from underneath your bed.  And yes, even to print out important electronic documentation that you should have printed months or years ago.  You can’t file everything until you have access to the documentation that needs to be filed.  If some items are already in order, try your best to keep them that way.

Starting a Personal Filing System Step 2: Brainstorming Important Filing Categories

Everyone will have different filing categories, although there will be some constants for just about everybody.  To give you an idea of the types of categories you may want to consider, here are a few of our personal filing categories:

• Extremely Important Government Records (passports, social security cards, birth certificates, selective service registration, etc).
• Life Insurance.
• Disability Insurance.
• Documentation About Our Dog. (Seriously, you would be amazed how often you need to provide proof of rabies shots).
• Prior Tax Returns.
• Specific Bank Accounts.
• Specific Investment Accounts.
• Utilities.
• Specific Credit Card Accounts/other Liabilities or Lines of Credit.
• School Information.
• Work Information.
• Medical.
• Your House and HomeOwner’s Insurance.  (or apartment and renter’s insurance).
• Your Cars.
• Specific Retirement Accounts.
• Records of any lawsuits.
• Your Business and Tax Records.
• And so on.

Starting a Personal Filing System Stage 3: Creating Folders For Each Category and Separating Papers Into Specific Categories

You will next want to use tabs/folders or another effective method to eventually separate each category.  It will take a long time to accomplish this.  After that is done,  go through all of the paperwork and separate it into your categories.

Starting a Personal Filing System Stage 4: Finalizing the Filing System.

Now take your categorized paperwork and place it into the proper tabs/area.  Make note throughout this process to throw out any unnecessary papers, but be very careful to be discerning in what you throw away.  Also, a shredder might be a great idea for any sensitive information you wish to dispose of.

You may want to take any papers older than a certain date and store them somewhere in a big container such as the basement.  We like to go through our filing every six months for the purpose of cleaning out older documentation.  We also try to stay up to date with new paperwork as it arises.

We try to always file in chronological order.  We keep our important documents/government paperwork either in a safety depsoit box or off-site.  For reasons of decor, we keep our filing in a cabinet that resembles a wooden piece of furniture.

Conclusion

The above is a simple personal filing system.  I am sure there are more elaborate and possibly more effective methods for creating a personal filing system.  Maybe you have even adapted a “virtual office” approach to your personal filing.  All I know is that each tax year we have everything we need and are able to file our taxes on time.

Which system do you use for filing?  What would you do to improve the system we use?  Happy filing!

Please subscribe to the Debt Payer Blog feed. (upper right hand corner).  Just a few clicks and you will receive every Debt Payer Post via your reader or email.

Image: jscreationzs / FreeDigitalPhotos.net