• Categories – This filing method can be as simple as an in and out box. But when trying to retrieve something from an inbox, you may have to go through a stack of papers. More complex method is to use Bank, Bills, Keep, Work. You can even break this down further. Bills-Electric, Bills-Rent, etc. or Bank-Chase, Credit Card-Discover, etc.
• Alphabetical – This system in its basic form is A-Z. This can be divided between vendor names and client names. Where there are A-Z for vendors and A-Z for clients.
• Chronological – Is a time based system 1-31 days, January –December, and yearly folders. This is also can be called a Tickler because each day it tickles your memory. You look in that day folder. Today is the 20^th so I look in the folder called 20. I deal with what is in that folder. It is emptied and either moved to the month folder if completed or a future date to finish.

 When thinking about a filing system instead of thinking how to store it you should think “how will I find it?” When I think of this I think of Radar O’Reily from the TV show MASH. When someone asked where the file for ordinance was because they could not find it under O, he said look under B. “B?” they replied. “B for BOOM!” he said. This is how we want our system to work. We want to be able to find things. We do not need to be concerned if others can.

 So which of the above 3 is the best for you?

• Categories – Like Radar that category that something is, this is where you find it. So if instead of thinking of AT&T, you think of phone or instead of Chase Home Mortgage, you think mortgage. Then this way of filing is more suited to you. Cons: If you have many utility providers, one for gas, one for electric, one for water, etc you may have a mix of bills all together.
• Alphabetical – Unlike the categories, if you think ConEd for power or Sprint for phone This may be a better system for you. You will file each vendor in their own folder. Cons: If you switch vendors or providers a lot you may have a lot of folders and very little paper.
• Chronological – If your problem is forgetting due dates or you can remember it happened in March or 2008 this is the system for you. Cons: You may find yourself looking through 2 years of papers if it happened in December or January. Or you know it happened in Spring but not the month you may be looking at 3 folders.

My solution is to use a combination method. It may be the solution for you too.

1. Chronological – For my tax information and returns I use a chronological filing. Each year has its own folder.
2. Alphabetical – I use this for employers, clients and vendors. I remember the name but not when it happened. So they each get a folder with their name.
3. Categories – I use categories for filing bank statements. Each bank account has its own folder. Bank – Chase, Bank-ING. For initial agreements and for papers that are not monthly statements, such as credit cards, loans, automobiles, they have a folder. Credit card-Discover, Loan- Student, Loan-Jeep, Car-Jeep, etc.
4. For my monthly bills, I have them filed under the vendor name because Quicken reminds me of when they are due.

 I hope this helps you in figuring out how to set up your own system. While no system is perfect for filing, if it helps you to retrieve papers when you need them, it works well.

 So the question became as I started just putting files in the drawer. What do I really need to keep?

According to the IRS, “The length of time you should keep a document depends on the action, expense, or event the document records. Generally, you must keep your records that support an item of income or deductions on a tax return until the period of limitations for that return runs out.”

1.  
   1. You owe additional tax and situations (2), (3), and (4), below, do not apply to you; keep records for 3 years.
   2. You do not report income that you should report, and it is more than 25% of the gross income shown on your return; keep records for 6 years.
   3. You file a fraudulent return; keep records indefinitely.
   4. You do not file a return; keep records indefinitely.
   5. You file a claim for credit or refund after you file your return; keep records for 3 years from the date you filed your original return or 2 years from the date you paid the tax, whichever is later.
   6. You file a claim for a loss from worthless securities or bad debt deduction; keep records for 7 years.
   7. Keep all employment tax records for at least 4 years after the date that the tax becomes due or is paid, whichever is later.

Kiplinger.com has additional info. They say you should keep you tax forms forever but the supporting documents you can get rid of after 3 years. If you were self employed they say you should keep the supporting documents for 6 years.

Scanning in your old tax forms can save space and be a good reference since the IRS routinely destroys tax returns after 5 years. So if they come asking for 6 or 7 years, you better have them because they may not.  If you want to scan in these documents to your computer be careful. The Motley Fool says, “If you use a computer-based system, note that you still need to keep the original paper documents too, because the IRS won’t just take your word on the accuracy of your computer data.”

Since this is all over the board for dates so let’s simplify things. You may be able to get rid of paper files after 7 years. But you should have at least scanned in your taxes for as long as you have been filing. Also you should keep the supporting documents W2s from employers, 1099s for interest and any other paperwork supporting your income. Also you should have any paperwork that supports your expenses and deductions. You will need to keep tax forms that relate to student loan interest home interest, stock losses (and income as well) and any receipts that support anything on you taxes.

The piles that were made to get them in completely disorganized my office. My financial papers were already an organized chaos. Some files were in the office some were in the basement. Mail was in the kitchen, bedroom and the office.

With moving in the cabinets, I begin my journey to organize my home financial records. This also marks a new beginning for ChangeJarSavings.

ChangeJarSavings started as a personal finance blog. I then got caught up in chasing deals. I wanted to share these deals but with increasing work demands, ChangeJarSavings deals fell by the wayside. A promotion at work meant even less time and I stopped posting all together.

Three months ago, I became unemployed. So I started to look around at my life and decided I needed to make some changes. I needed to get my financial life back in order, as well as find a job. Here it is October 18 and no job yet. I am mentally prepared to start organizing my life and it starts with my office.

For ChangeJarSavings the changes will happen over time. However, the focus will be returning to more personal finance stories. Please follow me as I go through setting up a new household filing system and organizing my life.

“Why most diaper bags are such monsters, you need room to pack for hours not days. Still looking for minimalistic diaper bag with no luck “

My wife had a solution. Our daughter packs a huge diaper bag for our grand kids for the weekends when they stay by us but we do not want to carry it around to go to the store. My wife started using one of her old purses or her expensive but rugged backpack from her college days. She went back to school when our kids were teenagers.

With both the backpack and the old purse they are large enough for a can of formula a bottle, diapers, wipes and an extra set of clothes. If we need more we either pack two bags or take the one “Mom” packed for the weekend.

Just my 2 cents. Jim @ ChangeJarSavings.com

© 2009 ChangeJarSavings.com

Just my 2 cents. Jim @ ChangeJarSavings.com

© 2009 ChangeJarSavings.com

I came up with a plan. I bought some colored markers (thin line) and a desk calendar. I put the calendar up in the stairwell to the basement so it was out of sight to guests. Each family memebr had a different color marker. They wrote all their appointments on the calendar.

If someone was not home from school when I thought they should be I looked at the calendar and there was a note saying my daughter had band practice after school or my son was going to so and so’s house to work on a project. I could also tell who had to be carted where each day. Total cost was less than $10.00.

Just my 2 cents. Jim @ ChangeJarSavings.com

© 2009 ChangeJarSavings.com

Everyone likes food. Since we first dated, my wife has baked for the holidays. All the relatives are happy with the breads and cookies. She skipped one year and still has not heard the last of it.

We have a 16 year old niece. A year ago we bought her minutes for her pay as you go phone. It was like we gave her a car.

Speaking of a car, the same niece started driving this year and she has a car now. But she has to pay for everything, repairs, gas, Insurance, etc. We gave her a gas card. It was her favorite present. She still thanks us for it a month later.

We also watch thrift stores. Many times we find name brand clothes with original tags from the name brand stores still on them. We have also collected crystal.

If you are really broke, try this. One year I had no job and no money. I looked at all my processions and found special items that I knew someone would love as much as me. I then gave each one away with a note on how I acquired the item and what it meant to me and why they were special to me too.

Here are a couple of ideas I found on the web that I thought are good too.

Set up a Google Talk account for a relative that lives far away and buy them a web cam. They can have video conversations with you. They can see grandkids, etc.

“Give actual shares of stock. You know how department stores sometimes have those neat “gifts under $10″ sections? The stock exchange has one too – and right now it’s piled to the ceiling with famous brand-name equities. Citigroup, Time Warner, News Corp. (publisher of the Wall Street Journal), Macy‘s, Goodyear, CBS, Sun Microsystems, Starbucks, Nordstorm, Whole Foods, Royal Caribbean. They’re all less than $10 a share.” These will increase in value when the economy turns around.

Piggy bank or savings bonds. Start a college fund for a youngster.

Free labor is a great idea if you have no cash. Babysitting for a night or two, cleaning every Saturday morning for a month, mowing the lawn or shoveling snow, painting, etc.

Just my 2 cents. Jim @ ChangeJarSavings.com

© 2008 ChangeJarSavings.com

With each paycheck since the end of October, I have been scrounging out $50.00. Thank god for lower gas prices. So far we have $100. We have spent about $40 of it but the credit cards are put away.

For most of the extended family we are giving baked goods, cookies, breads, etc. This was most of the $40 spent so far for ingredients and containers.

With the $100 that will come with the next two paydays before Christmas and the $60 left in the fund we will buy presents for the grandsons and our 3 kids (excuse me young adults).

Just my 2 cents. Jim @ ChangeJarSavings.com

© 2008 ChangeJarSavings.com

With 100s (more like 1000’s) of pictures being taken and stored on the computer, in envelopes and albums, how should we keep them organized? I am still figuring this one out as this is a work in progress. But here is what we are doing.

Digital pictures have brought their own set of problems. I don’t remember where I read this but digi-dumping is common. This is where you take the pictures off your camera and they are all over your hard drive. No organization. Creating computer clutter.

The software that came with our Cannon saved pictures by their shoot date. It gives a great chronological look at the past. We tried to start to group pictures but it became too time consuming. So we stuck with the chronological order. It just works.

We have 2 external hard drives with copies of all the digital pictures. One is at our house and one is at my work (offsite backup). So if we have a hard drive failure we will still have our pictures.

Actual clutter

The pictures that are loose we are collecting from around the house to put in one are to go through. I am thinking of setting up a plastic shoe box and starting to try to date them to put in chronological order as well. Then we will have a record of time of the kids growing up. The birthdays in order. The Christmas’ in order.

The albums are in storage in the basement. Not the worst place but not the best place for them. I would love to have all on them converted to digital pics but the cost involved is way too much. So they will sit there for now. They are off the floor so they won’t get wet and they are protected from the sun.

The slides are the ones that may be soon lost. They are yellowing and fading. But they are also from my childhood when slide projectors were the in thing. These will be the first I will have converted to digital.

Problems yet to solve

I would however like to rename the digital pictures from IMG00015.jpg to something more meaningful. Also I remember my grandparents writing on the back of the prints, who the people were so they could tell us well that was Aunt Betty’s friend, Josephine. If I could figure out how to do this in the digital age, it would be great.

I am not quite at a point to upload our photos to the web. Like I said my wife is a photo nut and I do not want to pay for storing them online.

It is a start. If you have ideas to the above problems I would like to hear them, please leave them in the comments section.

Just my 2 cents. Jim @ ChangeJarSavings.com

© 2008 ChangeJarSavings.com

Just my 2 cents. Jim @ ChangeJarSavings.com

© 2008 ChangeJarSavings.com