Paperwork is the bane of most of our lives, but for now it is a necessary evil. The checklist we’re looking at in the next few posts will help you work through your mountain of paper to make managing your finances infinitely easier.
Even though we’re surrounded by tech here in the 2020s, it seems like the millennia-old technology of paper isn’t going anywhere soon. The global pandemic has certainly meant that some strides have been made to reducing the paperwork burden, but still – if you have pensions, life insurance and investments, you’ve got paper, and probably a lot of it.
So, let's work through the checklist from start to finish. When we are done your filing system will be unrecognisable! You do have a filing system, right?!
Set a Date
Depending on the level of complexity of your financial affairs, this whole process could take anywhere between one hour and eight hours, maybe even more!
This isn't something that you can likely do on an impromptu basis, so the first thing you need to do is to get out your calendar and find a time where you can have at least a two-hour run at this. Write ‘Financial Clear-out’ in the space on your calendar and move on to the next point on the checklist.
Order Supplies
Given that we are dealing with PAPER work, we are going to need some stationery to help us tidy things up. You will need some or all of the following:
Storage box or filing cabinet – if your filing system is currently a whole bunch of envelopes stuffed in a drawer, then you can do better. You probably have a sense of how much paper you currently have. I'm going to help you radically reduce it, but even so you will need a place to store your files when they are tidied up. (see example here)
This could be one of those boxes which looks like an accordion, with different sections in it. These soon get quite heavy and unwieldy though, so I don't recommend them. A better option is a hard plastic filing box which can take hanging files like the ones you put into a proper filing cabinet. If you have room then maybe a filing cabinet is best. Personally, I prefer foolscap size files, but A4 works just fine.
Hanging files – these are the things that will form the sections of your filing system (like these)
Folders – my preference for these are simple square cut card folders. There are no closures or fastenings, they simply are thick card rectangles folded around your papers.
Label maker – there are all kinds of versions of these from cheap and cheerful to very fancy ones which connect to your computer. Strictly speaking this isn't necessary, all you need is a way to be able to label your files.
I find that having tidy labels makes the whole process more appealing and hence I'm more likely to keep up with it. That may tell you something about my psyche, but let's not get into that now!
Sharpie – the ubiquitous permanent marker is going to be really helpful in this process. Colour doesn't matter – I just use black (like this one)
Highlighter – one of those semi-transparent luminous coloured pens that make things stand out on the page.
Staple remover – you know, one of those things that get staples out of paper (example here)
Shredder – super important for security; don't throw anything away which has your name, address or any personal details on it (example here)
Scanner – if you want to get super fancy, you could use a scanner to digitise some of the documents, eliminating the need to keep the paper. Chances are that you'll end up with some kind of hybrid system. That's certainly what I do: I tend to scan anything important when it comes in but also keep it in my paper filing system for redundancy.
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