The day has arrived, your stationery supplies are in hand, and now is the time to get serious about your financial paperwork.
Get Everything Together
The first thing you need to do is to gather everything together into one massive pile. If you're lucky it'll be a medium-sized pile, but for most of us ‘massive’ will be the more appropriate adjective.
Don't be tempted to start sorting yet. You need to know what you're dealing with and you need to get everything in one place so that you know nothing is languishing in a drawer somewhere.
A large part of this is about clearing the mental clutter. Go through the house find every unopened envelope, or worse, open envelope with the contents stuffed back in. Don't take stuff out of envelopes yet, just pile it all up in one place.
Do an Initial Run-Through
The purpose here is to clear out extraneous paper like envelopes, booklets, shareholder meeting notifications from 1998 – that sort of thing. Take the top item off the pile, remove the envelope and recycle it. Check what the item is.
You're looking for the high-level things like provide a name, for example standard life, and you should also be looking for a policy or account number. Highlight the account number with the highlighter and also the date and the name of the policyholder if there's more than one of you in the household.
Create a space on the floor, or take everything off the dining room table and place that piece of paper down in its own space. If there is anything which looks obviously unnecessary, like flyers or marketing material, discard those now and recycle them. If in doubt, keep it. We'll be going through the papers in more detail in the next post.
Work your way through the pile from top to bottom. Place each new policy or account number document in its own pile. Obviously, if you come across a second document with the same account number, that goes on the same pile. You're aiming to have one pile for each policy, plan and account that you have.
By the end of this initial sweep, you should have no documents still in envelopes. Envelopes are the work of the devil and should be eliminated from your filing system. They are completely unsuitable for filing because they add a point of friction as you look for your stuff.
You can't see what's inside them without removing the papers; it's just madness, yet I see the envelope as the basis of a filing system in houses all the time.
Work Through Each Pile and Sort in Date Order
You should now have a bunch of piles of papers, each pile representing one policy, plan or account that you own. Take the first pile and sort through it, getting the documents into date order with the most recent document on the top and the oldest document at the bottom.
As you are working through, you may well come across more pieces of paper that are clearly not needed. For example, you don't usually need to keep the covering letters that come with paper statements.
The statement itself will have the date on it, so you don't need the nice words from Aviva’s Chief Executive thanking you for your trust. Do this for each of the piles so that eventually you have each pile sorted into date order and thinned out somewhat.
Once you've done this, you can move on to the next stage!
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