File It Easy, Find It Fast:
Filing System Operating Tips
This guide, one of a three-part series, shows how to use a home filing system.
Kathleen Prochaska-Cue, Extension Family Economist
Nancy G. Frecks, Associate Extension Educator
Leanne M. Manning, Extension Educator
Sandra D. Preston, Extension Educator
To tame the paper blizzard in your home, set up a home filing system that allows important papers to be filed easily and found fast when they are needed again. Here are some tips to help make a filing system more effective.
If your household has more than one person, the person who has the aptitude, attitude and time to manage the daily paper blizzard should do it. One person may do it all or the job of recordkeeping and filing may be shared. Everyone needs to help by being sure the mail, receipts, and other important papers are put in the agreed-on collection point, whether that is the “in” box on a desk or a file in a drawer.
Get in the habit — and help others in your house develop the same habit — of always putting the mail in a certain place as soon as it is brought into the house. Sort the mail into five categories:
- Newspapers, magazines, newsletters
- Personal mail
- Business mail
- Junk mail
Bills need to be put immediately into the “Bills to be Paid” folder at the front of the Active File system (Figure 1). (See NebGuide 1929, File It Easy, Find It Fast: Setup Suggestions for Home Filing Systems, for a description of the filing system.) Business mail may be placed in the “Pending” folder. Put personal mail and all newspapers, magazines, and newsletters in their proper places.
While junk mail can be tossed immediately, for safety purposes, always shred all junk mail that contains at least one of four critical items of personal identity information: legal name, address, Social Security number, or any financial account numbers.
Develop a system for paying bills. Twice a month works for most situations. At bill paying time, just grab the “Bills to be Paid” folder and you’re ready.
Balance checking accounts as soon as possible after the statement arrives. Check cash flow against the projected budget at least monthly.
Hold a monthly household financial meeting to discuss financial matters in general, such as a major purchase, vacation plans, or temporary or permanent income or expense changes.
While children do not need to know financial details, involve them in the general financial planning and as much as possible in the routine financial tasks. There’s no better way to learn financial management than to do some of the tasks involved under the supervision of a parent.
Children can write out checks (except for the signature), balance the checkbook, help with filing papers, and understand how to plan for emergencies and savings. Age and interest will obviously play a part in deciding when to involve a child, but do make “money talk” a natural part of your relationship to help children learn to manage money.
At least once a year, go through the Active Files and sift and sort. As you sort the Active Files, you’ll do one of four things with each piece of paper:
- Leave it in the present folder if it’s still current and needed.
- Move it to a different part of the Active system, but only if it’s current and needed.
- Move it to the Inactive system or safe deposit box.
- Toss. Be sure to shred any documents that could allow identity theft.
To decide whether to keep or toss a certain paper, ask:
- What could possibly happen to me if I don’t have this piece of paper?
- Will it cost me more to replace this piece of paper than the space and energy it takes to keep it?
Be ruthless, but prudent, especially after income tax filing time. By then you’ll know what you need to support the current year’s tax returns.
The Inactive File system also needs an occasional pruning. At least every five years, go through what’s in there and toss what’s no longer of importance. Be sure to shred any paper that might lead to identity theft.
A well-organized filing system will be a workable system that will save time, effort and money in the future.
This publication has been peer reviewed.
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Index: Financial Management
Budgets and Record Keeping
Issued January 2009