File Cabinet Reduction

I am not a lawyer, I am a Judgment and Collection Agency Broker. If you want legal advice or a strategy to use, you should contact an attorney.

Remember when the media used to told us the Net would create everything paperless? It seems that while most entities now generate less paperwork, there are now more entities to create paper.

As time passes, our filing cabinets start to get overstuffed. Yet, people refer to the documents kept there much less often.

Thinning out file folders is often a low priority task. In many cases, file folders get overstuffed. This adds hassles for moves, and when we die, those we leave behind must sift though countless of documents to locate that one needed document.

It's a great idea to trim file folders every year, or every couple of years. I think it is best to thin one part of a file cabinet at a time, while enjoying music or watching TV. That makes the sorting job painless and quick.

With periodic paperwork (e.g., statements), generally one should keep the first and the last few. Rather than of storing 10 years of phone bills, keep the first one and the last three. When you have to to itemize and save some or all documents for taxes, then store the documents in your tax files.

A quality scanner reduces your filing cabinet load. One example of a good scanner with PDF creation software, is the Fujitsu SnapScan. One can keep your PDFs in folders organized on your computer.

PC or Mac, be sure you back up the PDFs on at least 2 other disks (e.g., a cloud backup, and a backup to an external drive/disk).

As wonderful as cloud storage can be, you need a local backup too. While the slogan seems to be "trust the cloud", computers and networks do fail. Hurricanes, floods, power loss, earthquakes, etc., can make even the best go down or become unavailable.

When you have scanned what you need to PDFs, and your computer is properly backed up, you can begin throwing out or shredding many of your paper documents. If something bad happens at your location, cloud backups of PDFs might turn out being much safer than a single collection of paper-based records.

Obviously, legal, taxes, financial, and medical records are all much more important than utility records. There is not any need to save trivial or temporary documents. Keep some bank statements, throw away all your ATM receipts.

Of course, you must have a shredder for any personal information papers you are throwing out. Be sure to use a good shredder, that can accept several pieces of paper at once (or shred a credit card or disk) and cross-cuts the papers.

This is my opinion on how long to retain documents:

Certain documents, should be retained for life, or for decades:

Corporate documents, birth certificates, CPA audit reports, death certificates, tax returns, diplomas, retirement and pension records, licenses, important summary legal documents, patents, and trademarks.

Some records, should be kept for 6 years:

Accident reports and claims, builder contracts, annual financial statements, important correspondence, important legal documents, purchase records, property records, sales records, and registration applications. Mortgages, deeds, and leases - keep for 6 years beyond rental or ownership.

Some documents, should be retained for 3 years:

Insurance policies, improvement receipts, payroll records, medical bills, property records, stock records, and invoices from vendors.

Other kinds of records depend on how long you keep or own assets:

Bills and credit card receipts (keep until they appear on the next statement), pay stubs (keep until you receive a W2), sales receipts (keep as long as you own something), vehicle records (keep them for two years after the vehicle is sold), instruction and warranties (keep as long as you own something).

As I am a judgment broker, this is my opinion about document retention in a judgment enforcement or debt collection business, or if you enforce your own judgments. Just like personal records, you don't need to save everything.

I think that in every case, you can shred everything in a judgment case file 5 years after the judgment gets satisfied, becomes worthless because of bankruptcy, or is returned to the original judgment owner.

Almost every judgment enforcer use either a calculator with a ledger book, a spreadsheet, a database, or a finance or judgment program; to track costs, payments, and interest accruals.

When one uses a system to track everything, you don't need to store every document for 5years. If you prepared four court-stamped memorandum of costs over time, you only have to store one copy of the latest one, that summarizes all the previous costs and credits.

Once a writ has expired, you only need to keep one copy of it. You only have to retain one original court-endorsed copy of assignments of judgment, abstracts of judgment, and judgment satisfactions.