What records should you keep?Posted on December 2nd, 2012 under Wealth of Advice
By Francisco J. Colayco
Records of money movements or transactions are evidence of either ownership or debt. Owned assets increase or decrease in value. Debts and personal taxes constitute obligations and thus must be tracked during the payment period. In the end, the real value of these assets and liabilities can only be realized if properly supported by the proper documents and duly recorded.
As a general rule, we are never balanced in saving the right documents. Many keep every piece of paper, even tickets of movies etc. and become victims of their own mountain of what becomes trash. Some throw away everything and end up not remembering the more valuable information or worse, not have the important documents needed for support a special transaction. There has to be some balance.
Some of the documents you should always keep are:
- Employees should keep all their semi-monthly and monthly payroll notice advice. The same payroll notice should also be kept carefully to keep a record of the amounts withheld by the company for taxes, Social Security, Pag-ibig and all other deductions. These should all be kept practically till death since these may be necessary to avail of all the benefits from different government agencies.
- Those who need to file itemized Income Tax Returns have to keep their receipts to prove their income and expenses in making their returns. These need to be kept according to the regulation of the government most often it could be 3-7 years.
- Anything related to assets should be kept carefully until the asset is completely sold. For example, if you buy a lot and build a house or if you buy a house and lot or a car. Keep all documents related to the asset including construction and maintenance receipts. Put these together in an organized file so you can always trace your real cost and history of maintenance throughout the years. When you have sold the asset, you can also get rid of the documents.
- Bank accounts and credit card account statements should be examined closely upon receipt each time. If everything is correct, you can choose to discard the documents if you have other documents that support proof of your important transactions. For example, if you keep the receipts for payment of utilities and other important bills, you may not need to keep your statement anymore. Don’t keep double documents for the same purpose. For example, if you keep the receipt, you may not need the check that you used to pay for it.
- Investments of any kind should be documented and kept organized until you sell the investment completely. This includes investment in the stockmarket, bonds etc.
- You have to keep your marriage certificate, birth certificates of each member of your family, death certificates, medical reports and the like.
We want to share with you the importance of learning personal financial management. Call us at 6373731 or 6373741 or visit our website www.colaycofoundation.com.