Clear The Financial Clutter

With spring officially here and Tax Day – Monday, April 15 – right around the corner, getting your personal finances and paperwork organized quickly becomes a priority. Having your finances organized will not only make your tax season less complicated but can greatly simplify your life.

“Decluttering your finances and paperwork will go a long way in helping you achieve your financial goals,” says Julia Malta, a banking center manager with Comerica Bank. “Evaluating your credit, sorting through paperwork and visiting with a financial planner, can get you organized and on track to a stress-free tax season.”

Here are some simple tips to provide some cleanup to your finances and paperwork to ensure you are efficiently managing your funds.

Request a copy of your credit report. It’s free and knowing your credit score is imperative to maintaining your financial health. You can request a free credit report every 12 months from each of the three major consumer reporting companies – Equifax, Experian and TransUnion. Cleaning up your finances by searching for any mistakes or discrepancies on your credit report can help avoid issues if you are looking to make major purchases, such as a new home.

Go paperless. Discarding excess papers and files is a great way to clean up your financial clutter. Scan important documents to save electronically and shred the hard copies. Prevent further paper stacks by signing up for automatic online payments for your monthly bills and bank statements. By doing this, you’ll save time and help the environment by reducing paper usage.

Eliminate extra credit cards. Credit cards are helpful tools in building a line of credit; however, they are also one of the easiest ways to end up in mounds of debt quickly. Limit the number of credit cards you own; one is ideal. The fewer cards you have, the easier it is to pay in full, pay on time and manage how much you are charging.

Consult a financial planner. If you have questions or concerns about how to start getting financially organized, don’t hesitate to consult a financial planner or visit with your local banker.

Shred old documents. Many of us find it difficult to part with old financial documents. From old bills and bank statements to tax records, paperwork with your personal information can pile up quickly. There are some things you should keep, but many others you discard. For example, you can throw out:

• Most receipts once you’ve seen the transaction clear your account or show up on your credit card activity statement. However, if you plan to itemize expenses on your tax return, ask a tax professional which receipts you’ll need.
• Utility statements with sensitive information such as, phone, electric, water, etc., once they have been paid.

But, you should keep:

• Mortgage notes
• Receipts for major purchases, such as appliances
• Receipts that are deductible
• One year’s worth of bank statements
• One year’s worth of pay stubs
• IRA or 401k statements
• Three years’ worth of federal and state tax returns

Shredding documents with sensitive information is one of the best ways to prevent identity theft. In 2016, the Bureau of Justice Statistics discovered that 10 percent of people age 16 or older reported being a victim of identity theft with total loses reaching $17.5 billion.

Comerica can assist with shredding your sensitive documents during one of its Shred Day events hosted in various markets across the country. Each year, Shred Day events are held in Dallas/Fort Worth, Detroit, Houston and Phoenix. For more information on our Shred Day events, visit www.comerica.com.