The only thing worse than having an out-of-control pile of receipts, statements, and other personal documents is getting rid of something you should have held on to. Or worse, not shredding something that dumpster-diving thieves use to steal your identity. Why take chances? Here’s what to shred, and when.
Banking Documents You Should Shred
- Bank Statements. Shred monthly statements after 1 year. Hold on to annual statements related to your taxes. Or, better yet, switch to online statements. You’ll receive them via email which makes for improved fraud protection, as well as quick and easy filing and accessibility.
- Canceled Checks. Shred immediately. Scrawling VOID across the front may prevent that particular check from being used, but it doesn’t stop thieves from stealing your account and routing numbers.
- ATM and Debit Card Receipts. Since these display only the last four digits of an account number, many people choose to simply throw them away. However, if you are more comfortable shredding them, by all means, do.
Regardless of whether you shred them or not, hold on to these receipts for up 45 days (or until after you have made sure they match up against your monthly statements). Exception: Hold on to receipts that show proof of payment for tax-related transactions.
Credit Card Documents You Should Shred
- Credit Card Monthly Statements. Shred after 45 days. Exception: Hold on to them if they show proof of payment for tax-related transactions. As with bank statements, you should be able to opt into online statements/billing.
- Credit Card Receipts. Shred after 45 days (or until after you have made sure they match up against your statements). Exception: Hold on to credit card receipts that show proof of payment for tax-related transactions.
- Credit Card Offers. Shred immediately if you do not plan on applying for the card.
- Canceled Credit and Debit Cards. Shred immediately. If your shredder can’t handle plastic, cut them into quarters and throw the pieces away in separate trash bins. Granted, they should be unusable, but some experts advise erring on the side of caution and shredding them anyway.
- Credit Card Convenience Checks. Unless you plan to use them, shred them immediately.
- Credit Reports. Shred when you receive a more recent version.
Other Documents We Recommend Shredding
- Utility and/or Phone Bills. Shred after the bill is paid (and you have seen proof of such via a receipt or draft from your bank account.) Exception: Hold on to them if they qualify as tax-related transactions.
- Pay Stubs. Shred after 1 year (or after making sure they match up against income reported on your W-2).
- Old Tax Returns. Shred after 7 years, or not at all.
- IRS Has Three Years to Audit a Filed Return. That is unless they suspect you have under-reported your income, in which case they have 6 years, or if they suspect you filed a fraudulent return, in which case they can audit you at any time. For this reason, many suggest holding on to your tax returns indefinitely. At the very least, you may want to hold on to your W-2s and 1099’s.
- Social Security Statements. Shred when you receive an updated version.
- Old Photo IDs. Shred when expired.
- Medical Documents. Shred physician statements and receipts after 1 year. Hold on to medical histories, prescription information, and physician contact information. Don’t take any chances with this one. Medical identity theft is the fastest-growing crime in America. So if you’re throwing a medical document out, shred it. Otherwise, you are giving thieves access to information that could be used to obtain prescription drugs, healthcare services, or even to collect money through fraudulent claims against your health insurance policy. What’s worse, it could compromise your medical history and, in turn, your health.
- Insurance Documents. Shred after the life of the policy, plus 5 years. Hold on to hospital bills and receipts, prescription information, and car repair receipts.
- Retirement Plan Statements. Shred quarterly statements after 1 year. Hold on to your annual statements until you retire.
- Brokerage Statements and Investment Records. Shred monthly statements after 1 year. Hold on to annual summaries for as long as you own the security, plus 7 years.
- Mortgage Documents. Shred 6 years after the sale of the property.
- Junk Mail. If it’s addressed to “Current Occupant,” you can just trash it. As for junk mail addressed to you, experts advise shredding it.
To opt-out of other junk mail write: Mail Preference Service, Direct Marketing Association, P.O. Box 9008, Farmingdale, NY 11735. And call 1-800-407-1088. Include your complete name, name variations, and mailing address.
If you’re still using the old-school strip-cut shredder, think about switching to a cross-cut. The strip-cut shredder is less secure than the cross-cut as, theoretically, a thief could take the painstaking time to paste all of those thin strips of paper back together. Unlikely, yes. Impossible, no.
The cross-cut shredder is a great alternative, as it cuts paper into confetti-size pieces. Unfortunately, this does make the paper more difficult to recycle. Therefore, many people who use the cross-cut get creative with their confetti, using it in compost, as packing material, or as a fireplace starter.
While all of this may seem like a lot to remember and do, the learning curve is worth it. Just remember, if it’s a document you’re not sure you should get rid of, hold on to it. And if it’s a document you know you can throw out but aren’t sure you need to shred, shred it anyway.