There are two possible takeaways from the title of this post. Either, the instruction is to shred rather than trash, or, you should infer that there’s value in saving bills and receipts. I believe both statements to be true.
There was a time when a shredder was, like a copy machine, a fancy piece of equipment found only in professional offices. These days, shredders are touted as must-haves for every home. And, not without reason. If you’re new to the identity theft conversation, you may not be aware of the concept of ‘dumpster diving’, whereby identity thieves comb through the garbage for personal information they can use to set up fraudulent accounts. Despite a dizzying array of sophisticated, technology-enabled methods for pillaging someone’s identity, identity theft is most often accomplished through low-tech methods, including dumpster diving.
It makes sense. We’re constantly inundated with hard copies of important information that we may not choose to keep on hand – financial statements and applications, bills, lease agreements, contracts, etc. And, if you’re not the type to file away every receipt, you may find yourself setting dumpster-diver bait when you toss those seemingly outdated and worthless documents out. If I can‘t convince you that sometimes bills and receipts are important (read below), at least trust that they need to be shredded before leaving your possession. Identity thieves can be patient and cunning, and will source information through various means to compile a complete enough profile to be able to exploit your identity. I probably take it to an extreme, but I shred anything with my name, address, birthday, bank name, or even partial credit card number. Better to be safe than sorry. And, I’ve come to find shredding to be cathartic.
Of course, I don’t shred everything, or even most things. I keep fairly well-organized archives of bank statements, corresponding receipts, and other seemingly important information. And, while staying organized takes effort, on multiple occasions I’ve found that it has saved me hours, headaches, and dollars.
A few years ago I received a letter from the IRS suggesting that information on my tax return was incorrect. Being the fastidious record-keeper that I am, within a minute or two, I was able to find the exact document necessary – a corrected W-2 from an employer – to back-up my tax return. Several weeks later I was notified that the case was closed. Victory! Hours spent keeping my records in line paid off, and I never had to have a conversation with anyone at the IRS.
More importantly, I’ve found that good record keeping has saved me hundreds, if not thousands, of dollars. Hand-in-hand with my strong desire to keep well-organized financial records is an even stronger desire to declutter the space around me. It’s not uncommon for my gaze to come across something I may have purchased that I’ve not found use for. Fortunately, I usually know exactly where the receipt is, and am not shy about making returns. Not only does this create space in my home for my many files, but it creates space in my budget every time I receive a refund!
For me, receipt management is a twofold process. I keep my receipts so that I always have the option to make returns and so that I can defend any financial claims I make. And, when it’s time to finally part with my records, I make sure that they’re of no use to anyone. Worried about having to store too much information? Read on for specific tips on what to shred and what to keep.