At the beginning of each year, as a business owner, you need to review the previous years files. Whether the papers are on your desk or in a filing cabinet, you should review them at least once a year not only for tax purpose but also for saving space. The steps below will help you decide on what to do with each piece of paper. To make this process a success, make a decision and take action! If you don’t make a decision and take action on each piece of paper, it will stay in limbo which means it will be left out.
Decide if you need to keep the paper.
If no, decide whether to recycle or shred it. Then, finish the action by recycling the paper or shredding it!
If yes, what does the paper need to be used for?
1. Storage? i.e. bills or important correspondences, new mortgage paperwork, general receipts, etc…
2. Tax Return? Pay stubs (to check in when the W-2 comes in.), Donation slips, Donation receipts, Mortgage interest, deduction receipts, etc..
3. Place each piece of paper in a pile either marked “storage” or “tax return”, “shred” or “recycle”.
Answer this question for each pile you requested: Where are you going to store this pile?
1. in a filing box – label the manila file folder , since it is to be stored away for the long-term, you do not need to use a pretty label. A handwritten label is fine.
2. in a filing cabinet - file in a folder with a label on it. Be specific enough to help you remember what the file was for, but general enough that you don’t have one piece of paper in the file.
3. in a folder – label the folder. Be specific but general enough to hold more than one paper in the folder.
By following these instructions each year, you will be establishing a system that you can easily refer to when you need to find a piece of paper in later years.
Hope your paper management process goes smoothly.
Till next time.