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A Complete Guide to Effectively Organizing your Paperwork & Mail

Last updated by on 11 Comments

How to Organize Paperwork

We’d all like to think that we’re at or near going paperless (and perhaps a few of us are). However, the truth is that most of us still receive enough snail mail to make it a pain to take care of and organize.

Having huge piles of documents laying around can only leave one feeling unorganized and a little stressed. An afternoon worth of work can set you up permanently with a system to relieve that cluttered feeling. It took me a few years to develop an effective system worth sharing. Here it is:

From the Mailbox to what?

how to go paperlessWhen you break it down, all paper mail can be divided into four categories. This stage is often the toughest part of the process because it requires you to make a decision about the value of the piece of paper in your hand. Here are the four categories:

1. Recycle: This is typically junk mail or mail that does not have anything you wouldn’t want someone else to know about you on it. I place all of this mail into a brown paper grocery bag and then it goes out to the curb every Wednesday for pickup.

2. Shred, then Recycle: This is mail and documents that have some sort of personal identifiers on it that could potentially organize paperworklead to some sort of identity theft if stolen. If you do not have a paper shredder, it is a MUST HAVE.

3. Take Action: For the following two categories I keep a brown manila folder on my coffee table with labels on them. The first is labeled ‘take action’. Non-ironically, this means the paper has some sort of action I must take on it. Perhaps it’s a bill that must be paid, a questionnaire I need to return, or something else.

This folder can even serve as a reminder for mail that you need to initiate, versus reactively reply to. You can simply write yourself a note or put a blank envelope within the folder so that the next time you clear your folder out, you can take the action. It’s usually good to clear a folder out once a week.

4. File: This is all of the stuff that you don’t need to take action on that you think is good to keep around. It can include medical documents, paystubs, tax documents, investment statements, etc (see below). The trick here is to keep only the stuff you need to keep because you will quickly find your files to be overrun.

How to File Documents Effectively

document organizationAll of your ‘file’ documents will need a home. For this I have a two-drawer file cabinet with labeled hanging files. The types of files are broken into ‘parent categories’, and ‘subcategories’ by theme. Here are the parent categories (each with a large hanging folder), and the subs I have within them, which each have their own non-hanging folder:

  • Work: payroll statements, expense check receipts
  • Home: home insurance, property tax assessments, mortgage paperwork, mortgage statements, home improvement projects
  • Medical: dental, medical, health insurance, life insurance
  • Retirement: 401K statements, Social Security statements
  • Investing: One folder for each brokerage account that I own, bank statements, company stock options
  • Auto: title, insurance, maintenance records (I prefer to keep in my car)
  • Tax: tax documents, all docs from previous tax year, all docs from two tax years ago, all deductible receipts
  • Bills: phone, internet, cable, gas, electric, water, credit card(s)
  • Misc: anything else you feel is worth keeping

What Happens when My Filers Get too Full?

I have three steps to deal with this issue and reduce the clutter in my filing cabinet:

  1. When I receive a new document to be filed, I place it in the back of its contain folder so that everything is organized by date, with the oldest docs first.
  2. Once a year, I go through the cabinet and shred things I most likely will no longer need.
  3. Keep the good stuff. I like to keep a year’s (at least) for just about everything. Some things like tax related docs I go back at least 2 years on. Other things, you just never get rid of – you probably know which docs these are.

Final Thoughts on Organizing your Paper Clutter

If you are able, try to eliminate is much paperwork as you can by opting for emailed statements. A little work and organization can definitely lift a huge weight off your shoulders, tidy up your living space, and make things easier to find. You may also find that you are much more on top of things and don’t miss taking actions when needed.

  • Do you have a paper organization system in place?
  • What works for you?
  • Are you near paperless?

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About the Author
I am G.E. Miller, & this is my story. My goal is financial independence ASAP. If you share that goal, join me & 7,500+ others by getting FREE email updates. You'll also find every post by category & every post in order.


11 Comments »
  • Michelle says:

    Supporting tips:

    Stand over your paper recycling bin/bag while opening your mail. Gravity is your friend.

    Tear your address off of junk mail before letting the mail fall into the bag. Shred the scrap of paper with your name/ address.

    Two-drawer filing cabinets are ubiquitous and can often be found for free on freecycle or craigslist, or at thrift stores.

  • Studenomics says:

    I must admit that my biggest issue stems from the fact that I hold onto paperwork for longer than I should. I am effective when it comes to organizing my paperwork (I keep everything in labeled folders). Every year or so I realize the paperwork (old course notes, receipts, bills, random documents)is getting out of control so I throw out as much as possible.

  • G.E. Miller says:

    @ Michelle – 3 great supporting tips. Thank you.

    @ Studenomics – yes, that typically is one of the bigger challenges, and not a fun task when you go to clean everything out – it’s hard to get excited about it.

  • Trevor says:

    My desk is always littered with junk. My wife will sort through the mail and pull everything out that has her name on it and throw the rest on my desk. I am usually only home on the weekends, so I rarely look at the pile on my desk. I would like to try implementing your regimen above. I’ll see if I can get her buy-in.

  • Shaun Connell says:

    Ah, great guide. I “favorited” it.

    Most of my “paperwork” is actually in digital form. I keep two digital copies of the “important” documents; one on my laptop and one on google docs. I find it to be a little less messy and easier to organize.

  • Craig says:

    I am like Studenomics. I tend to hold on to paper or receipts longer than normal. Because of online banking I have eliminated papers that way, and can throw out more bank statements I receive because of it. I try to stay organized but don’t have any official system. I usually use folders at work, maybe I should try at home as well.

  • Dade says:

    Is there a way to become a content writer for the site?

  • Shawn says:

    Great thoughts here and I’m all about eliminating clutter. I go through mail immediately and throw junk away. “Good stuff” goes in my inbox to be dealt with. Then once a week a clear out that inbox to get back to empty. At that point, somethings get shredded and others get filed.

  • JaramacyC says:

    An afternoon worth of work can set you up permanently with a system to relieve that cluttered feeling. It took me a few years to develop an effective system worth sharing. This stage is often the toughest part of the process because it requires you to make a decision about the value of the piece of paper in your hand. I place all of this mail into a brown paper grocery bag and then it goes out to the curb every Wednesday for pickup. The trick here is to keep only the stuff you need to keep because you will quickly find your files to be overrun. My wife will sort through the mail and pull everything out that has her name on it and throw the rest on my desk. I would like to try implementing your regimen above. I find it to be a little less messy and easier to organize. I tend to hold on to paper or receipts longer than normal. Just send them your receipts and they will scan and organize them for you. I go through mail immediately and throw junk away. Then once a week a clear out that inbox to get back to empty.Hey i do like the post it is very nice . I do read this and enjoyed it let me know if you post any new.

  • Michelle says:

    I’m returning here 3.5 years after first reading this post! I hopped back here from your recent identity theft post. I’m finally going to implement your three file mail sorting system. I’m using paper clips to bundle together mail that I will file into the same subject-specific file, and post-it notes to label them by topic. For instance, I often get a slew of student loan papers at the same time from the same loan holding company but in separate envelopes.

    Also, I recently forwarded to a family member your post about protecting one’s self against bank fraud while traveling abroad.

    Thanks for the enduringly valuable advice.

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