How to File and Manage Paperwork Easily and Quickly

Feeling overwhelmed by the volume of paper that comes in your door? Is tax time a nightmare of unfiled papers and stuffed full file cabinets? Having trouble finding that piece of paper you need? This simple, effective system is the cure!

Difficulty: Easy

Instructions

Things You'll Need:

• File cabinet
• File boxes
• Plain file folders
• Hanging folders
• Sticky file labels
• Pen & Marker

1. Gather all your current files and papers
   
   If you have a file cabinet already that is full of stuff, empty it out, and stack all the files nearby. Gather all your other papers, where ever they are, and stack them along with whatever you pulled from the file cabinet.

2. 
    

   Initial Filing
   
   This is the time-consuming part, but only needs to be done ONCE IN YOUR LIFE. Go methodically through the stacks of folders and paperwork, and for each paper, file it as follows.
   
   If it is older than 7 years and not something you're interested in keeping (e.g. awards), throw it out. Be ruthless.
   
   For everything else, make a file folder. Write the label in a "category - detail - year" format. For instance, "Banking - xyz bank acct# 1234567 - 2009", "Utilities - Phone - 2008". If it is a date-irrelevant" piece of paper (e.g. an original loan document, award, restaurant menu, etc.) use the above label format without the date (e.g. "Restaurant Menus", "Loan, abc Loan Co Acct# 654321").
   
   This means that for a particular loan, for instance, you may end up with as many 8 folders - a date-irrelevant folder, and 7 folders for the current and previous 6 years.
   
   Make sure you have a tax folder for each year. Keep other receipts not needed for taxes in a folder labeled "Receipts - nontax", but no date (more on this later). Only add receipts that you need to keep - products that you recently purchased (for returns), that you need for warranties, etc.
   
   Put the folders for the current and previous year, and date-irrelevant folders that need to be kept handy, in hanging folders. You can put multiple folders in the same hanging folder, just don't stuff them too full. Put the hanging folders in the file cabinet in alphabetical order by category. You can further break this down by putting all money-related folders in one drawer, reference material folders in another, etc.
   
   Put folders older than the previous year, or date-irrelevant files that do not need to be kept handy, in the file boxes, keeping all folders for a given year together. Also keep date-irrelevant files together. When you're done, label these boxes "Old Files" and put them up in the attic, or elsewhere out of the way.

3. Weekly Filing - 15 minutes tops and a few minutes daily
   
   When the mail comes in, IMMEDIATELY toss all junk mail, and put the rest on your desk, preferably in a bin of some sort. Once per week, sit down and go through the mail and deal with whatever has to be dealt with - pay the bills and deal with stuff that can be dealt with now in less than 5 or 10 minutes.
   
   For stuff that will take longer to do or can't be done right now for some reason, put it in a "to do" folder and put an appointment in your calendar to deal with it. For stuff that is pending information or action from someone else, put it in a "follow-up" folder and put a reminder in your calendar to follow up at the approriate time.
   
   Put everything else in their appropriate folders in your file cabinet. Make a new file if you don't have one for a given item. Put receipts and other paperwork you'll need for taxes in your tax folder for the current year.

4. 
    

   EASY Year End Turnover - 15 minutes
   
   In January or February, once your taxes are done (that was easy - just one folder with all the info you need!) take out all the folders for oldest year. For example, if it is Jan 2009, take out all the 2007 files.
   
   Toss (preferably shred) all the files that don't need to be kept - primarily utilities files (phone, electricity, etc.) Keep the file folders, change the date on them to the current year and put them back in the file cabinet.
   
   Go through your "Receipts - nontax" folder and throw out any receipts that are no longer needed. Do this for any other applicable folders, as well.
   
   Pull out your file boxes, toss (shred) the oldest year (now eight years old) and put in the files you just removed from your file cabinet, and put them back away.
   
   Make out new file folders for the current year, and you're done!

Tips & Warnings

• File EVERYTHING that is paper, including warranties, restaurant menus, educational records, etc.
• Do NOT waste time messing with plastic tabs - no labels are needed for the hanging folders. They are just a convenient holder for the file folders.
• Use a file folder as a handy year divider in your file boxes - cut about an inch off the side and turn sideways, putting the year at the top, so it's sticking slightly above the other folders.