Tips on how long to keep Financial Records
If we are talking about personal finance, it is still manageable. However, for business records, financial data is very important due to audit references, credit purchases that have extensive pay period.
Normally, business related financial data should be stored for a period of 2 years minimum. This way it provides enough references to track back and correct any errors or settle outstanding financial matters. 2 tax filing periods is a safe time zone to store your financial records within reach. If you are keeping personal financial records, you can decide based on various measures.
Firstly, ensure that you do not keep any of those settled bills that are already accounted for unless you plan to do up a proper financial data analysis which I doubt. Hence, once your bills are settled, record them and file them away. Basically, you can decide on what records to keep based on short term and long term settlements.
Normally, if you are the type of person who settles the credit card bills on time and in full, you need to keep your financial record till you have settled in full. Otherwise, you need to ensure that you keep a copy of all bills outstanding just so that you can spot any discrepancies on finance charges billing for the accrued interest for deferred payments. It is safe to say that you should store such records for at least a year before you can review and sort that you can discard.
Mortgages and housing loans related financial records should be stored till the complete liability is paid off.
It is a good idea to shelf the bills and invoices by filing them away. However, once you are sure you do not need them anymore, you should shred them so that unnecessary financial details do not reach third party.
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