This Is How Long You Should Be Keeping Your Credit Card Statements

After this many years, feel free to clear out the clutter and shred these documents...but not a moment before.

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There are two types of people in this world: Those who have a closet filled with every credit card statement, receipt, and pay stub they have ever received, and those who toss them out the moment they touch their hands. So which method is correct? Neither.

“It’s advisable to hold onto credit card statements for seven years if there are any charges related to taxes,” says Tony Steuer, an authority on financial literacy and author of GET READY! A Step-by-Step Planner for Maintaining Your Financial First-Aid Kit. “Otherwise statements and receipts can be shredded after the statements are reconciled. Personally, I keep them for six years after the tax deadline just to be on the safe side, as that’s the length of time that the IRS can do a tax audit.” However, be sure to always keep a copy of these tax-related documents.

After this time period is up, make sure to shred the statements to prevent identity theft—and while you’re at it, don’t forget to shred these 8 revealing everyday documents.

Organizing digital and hard copies

Creating a structured filing system both helps organize your financial life and makes it easier to find information should you need it down the road. Steuer advises saving digital copies of your credit card statements indefinitely, by setting up folders on your computer for each calendar year. Then create sub-folders by financial categories, such as utilities, mortgage, insurance, bank, and credit card statements, etc., and then have subfolders for each credit card. Use these organizational tricks to save yourself money.

A paper filing system would follow the same hierarchy: Select a binder, accordion folder or box for each year and then break it down by main categories with specific providers/entities in the appropriate category.

“You can also scan statements and receipts and save them to your computer or to a cloud account such as Dropbox, Evernote, or iCloud using the same folder hierarchy,” says Steuer. “Whatever system you use should be the one that works best for you and allows you to find your financial documents.”

While you are organizing your personal files, take some time to make sure you organize these important documents before it’s too late.

And if you find down the road that you’ve shredded a document you need, Steuer says you should be able to access copies of your credit card statements online or by requesting them through the card-issuing entity. Next, read on to find out 13 secrets an IRS agent won’t tell you.

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Jill Schildhouse
Jill Schildhouse is an award-winning writer based in Phoenix who regularly covers travel, health and wellness, personal finance and e-commerce. Her bylines have appeared in Reader's Digest, The Healthy, Oxygen, AAA, Brides, Vegetarian Times, and Phoenix Home & Garden magazines, among others. She earned a BA in corporate communications from Northern Illinois University. Follow her on Instagram, Twitter, Facebook and Linkedin