1. Financial Recordkeeping
Presented By:
Facility
You need a room that has enough space for people to move around the room. You will need approximately 35 minutes to complete this presentation.
Audience
Master Financial Education Volunteers and public presentations
Instructional Objectives
Participants will:
Understand the basic principles of recordkeeping
Materials
Multimedia projector
Laptop computer with PowerPoint
Home file boxes, hanging or colored file folders to show the audience
Flipchart and markers
Publication Emergencies: Are You Prepared - Your Personal Checklist of Important Documents
Revised 2011 by Celia Ray Hayhoe, Ph.D.,
Family Resource Management Specialist , Virginia Tech
Developed by Beverly S. Butterfield, CFCS, Former Northern District Director, Virginia Cooperative Extension 52

2. Overview What records you should keep
Where you should keep your vital records
How long to keep certain records
Is your house overrun with paper? Can you find records when you need them? Do you have records in a safe place? Do you have what you need to take with you if you have to vacate your house in a hurry? This presentation will help you understand how records can help you with your planning and how to keep your information where it will be the safest.

3. How to Achieve Financial Success
Evaluate
Control
Implement
We have covered clarifying values and setting S.M.A.R.T. goals.
Organize - This phase involves gathering information needed to create financial statements and spending plans. This step recognizes the value of record keeping.
Later units discuss the statement just mentioned.
Decide
Monitor,
review,
revise
Organize
Set goals
Clarify values 54

4. Why Do We Keep Records? For historical purposes
To use as we make financial decisions
To assist in times of need or crisis
To show proof of payments
To protect us
To assist with tax preparation
Financial records are invaluable for historical purposes, both for future generations, as well as to track where you have been and how you have progressed financially.
Keeping records is essential if you are going to work on a spending plan or other financial statements. Records are important to help us make financial decisions.
Some records and the ability to find them are necessary in times of crisis such as a death in the family, theft, or fire.
Records are important to show proof of payment if there is a dispute. They can protect us, for instance if there is the need to make an insurance claim, or to find out what procedures the insurance company requires (e.g. how to access medical care, or where to call to get permission before getting medical care.)
Organized recordkeeping is important to properly prepare taxes, and if audited, to prove how money was spent. 55

5. Rules to Begin With Open all mail on the day it arrives
Destroy & discard things you don’t need
Sort into “Handle Immediately”, and “To Be Filed”
Place bills in a safe place
When adding to files, discard
duplicates or outdated information
Here are some practical rules to follow to help you to get started with organizing financial records.
First, open all mail on the day that it arrives. Have a place that mail is opened and a system for what to do with it.
Discard things that you don’t need, such as advertisements.
Sort what remains into piles of “Handle Immediately”, such as bills, or “To Be Filed”.
Place all bills in a safe and easy-to-find place so that when bills are paid none are accidentally missed.
When filing, discard any duplicate or outdated information in the files. 56

6. Getting Started Start where you are--but do start!
Break big jobs into small ones
Make your system suit your personality and your lifestyle
Gather the right tools for the job
Keep like things together
Involve other family members
Here are some principles that will make record keeping easier.
Start where you are, but do start. If you have a large pile of things to be filed or file folders filled with old information, break big jobs into small ones by selecting an amount to work on that can be completed in one sitting.
Make your system match your personality. Some people will want colored file folders and matching labels. Others will want a very simple and inexpensive system. Don’t make the system overly complex or you won’t be able to maintain it.
Assemble the right tools for the job. If you need hanging file folders, or new labels, or an extra file box, purchase what you need to do the job.
Start by sorting papers into piles with like things together, such as all insurance papers, or all investment papers, etc.
Involve other family members so that they know how to use and maintain the file.
(Note to presenter: this is a good place to show samples of home file boxes, hanging or colored file folders, etc.) 57

7. Activity: What’s in your wallet
Write down what records you think are in your wallet
Now take out your wallet to see what records you actually have stored in your wallet
Is this the best place for these records, if not where should they be stored?
Activity: Ask group to write down what records they think are in their wallets. Then have them take out their wallets to see what records they actually have stored in their wallet.
Ask: Is this the best place for these records?
The following slides discuss where things should be stored. 58

8. Where Do We Keep Records?
In our wallets
In a safe deposit box
In a home filing system
In a to-go box
Remember to back-up very important records
There are generally four places that records should be kept
1) In a wallet
2) In a safe deposit box
In a home filing system
In a to-go box
See: Virginia Cooperation Extension publication Emergencies: Are You Prepared:-Your Personal Checklist of Important Documents
There are some very important records that need to be backed up. Can you think of an example of one of these? (Have the participants shout out some answers and write them on a flip chart.)
One example,
Will--Original copy should be kept in a safe place such as a safe deposit box with copies elsewhere, such as in an attorney’s office, in your home filing system and with the executor named in the will.
While most of these slides refer to paper files, many families are now keeping financial records on CD’s or computer disks. If this is the case, maintain frequent back-ups and/or hard copies of computer files.
The next few slides illustrate types of records that can be kept in each place. 59

9. Records to Keep in Your Wallet
Driver’s license
Personal identification
Health insurance card
Emergency contact information
Record of medical problems
Credit cards
List of medications
Here are some examples of records that might be kept in a wallet. Note that while we keep credit cards in our wallets, we should keep a listing of the cards in another place at home in case the wallet is stolen or lost. For personal information, remember that it is possible to get a number other than the social security number as the identification number on the driver’s license. 60

10. Records to Keep in a Safe Deposit Box
Title and bill of sale for vehicles
Deed for your home and copy of the note and mortgage, bill for major improvements
Certificates and Records: birth, marriage, death, divorce, citizenship, adoption, passport, & military service records
Name & addresses of financial
planners and institutions
The next three slides list files that may be kept in a safe deposit box. It is often a good idea to keep a list of the contents of the safe deposit box in a filing system at home. Some families prefer to keep these kinds of records in a fire-proof box at home.
Some examples of certificates include birth certificates, marriage certificates, death certificates, and divorce certificates. Examples of records include adoption records, citizenship records and military service records.
(See Emergencies publication for more examples.) 61

11. Safe Deposit Box, cont.
Originals of legal papers (will, trust, health care proxy, etc.)
List of records in your home file
Copy of household inventory
List of insurance policies
Certificates of deposit
In the event of a crisis or emergency, most of us could not remember a fraction of what we own and would risk getting short-changed in an insurance settlement as a result. Updated inventories can help us check to make sure that we are adequately insured. They can also remind us to begin setting up a savings plan to replace equipment that is getting outdated.
Household inventory can be as simple as a listing of contents of home. Pictures enhance the inventory. Another method some families prefer is to make a video tape of the contents of the home. To make the inventory the most useful, attach any documentation of actual cost or appraisals of items. (Reference: VCE Publication # “Families Taking Charge: Taking Inventory”.)
Be sure that with insurance policy information you include policy number and contact information. 62

12. Safe Deposit Box, cont. Stock certificates, contracts, notes, & debts
Bonds
Copy of Social Security Card
Most people allow their broker to keep their stocks and bonds to make trading easier. However, if you do have any original stock certificates or bonds, they should be kept in a safety deposit box and the record of the serial numbers should be in your home file. 63

13. At Home--File Drawer Family records Property records Financial records
Home business records
Of records kept at home in the home file drawer, some people divide the files into four categories:
1) Family records
2) Property records
3) Financial records
4) Home Business records
Let’s take a look now at what might be included in each of these categories. 64

14. Family Records
Names, addresses, phone numbers of family advisors (legal, medical, etc.)
Health records
Insurance policies (auto, property, life, health, disability, etc.)
Licenses to practice, if applicable
Examples of Family Records include contact information for professionals and those who provide any type of legal, financial, social or emotional support for the household. 65

15. Property Records Copies of titles for cars or other vehicles
Instruction books (for appliances, vehicles)
Guarantees and warranties
Repair/maintenance records
Household inventory
Examples of Property records include titles for automobiles, motorcycles, boats, etc.
In addition they can include guarantees and warranties, a copy of the household inventory, and any instruction books for appliances or cars, etc.
It is a good idea to keep repair or maintenance records in these files as well. 66

16. Financial Records Account books Income tax returns
Bank account information & cancelled checks
Credit card information
Education, employment and Social Security records
The next two slides contain examples of financial records.
Credit card information is needed to report a lost or stolen card. Make sure that a phone number is listed for each card carried in the wallet. One easy way to capture this information is to lay all credit cards on a copy machine and copy the fronts, and then flip them to copy the backs. 67

17. Financial Records, cont.
Safe deposit box information
Stock and bond information
Note and debt information
Real estate ownership records
Receipts, sales slips
Savings information and statements
Do keep a record of any transaction records for investments. It is important to keep a yearly summary and statements for the previous year.
Note any improvements made to property and expense involved, filing with the real estate ownership records.
Make note in records of where safe deposit box is located and also key and password information. 68

18. How Long to Keep Records
Review all family records once a year
Review any time you have a major life change
Inactive files--old tax records, some say 3, 7, 10 years, forever?
Even the best recordkeeping system will not fit your needs forever. Times of transition such as changes in job status or family status can trigger a need to review the financial recordkeeping system. It is good to review records at least once a year. Many families plan to review records at tax time. This is a good time to do some housecleaning with any outdated or unneeded files.
The IRS can ask to see records up to 3 years. If you are suspected of under-reporting your income, however, the IRS can go back 6 years. If you are suspected of fraud or failure to pay, they can go back indefinitely.
Housing records should be kept for as long as you own your home, plus at least 3 years for tax records (this applies to deeds, title papers, mortgages, home improvement receipts, and tax forms related to sale or exchange of principal residence).
Inactive files may consist of a box in the garage or attic. These files hold papers you do not use but may need in the future. Old tax returns are an example of an inactive file that may be kept indefinitely. 69

19. In Summary... Develop a system that makes sense to you.
Determine a logical place for each type of record according to ease of use, security needs, etc.
Maintain your system on a regular basis.
Review and adjust system as needed.
In summary, we have been talking about developing a recordkeeping system. There are many different ways that this can be done. The main thing is to develop a system that is adequate, and yet not too complex to maintain. The recordkeeping system should make sense to you, and also to any family members who will also be responsible for storing or maintaining records.
Each type of record should be stored in a logical place. No system will last forever. Plan for regular maintenance of your record-keeping system to keep it current and accurate.
If you find that certain types of records are routinely not getting put away where they belong, analyze why that might be and if there is a better way for those records to be maintained.
Good recordkeeping can save money, time, and offer peace of mind. 70

20. Questions?
Does anyone in the audience have a question they would like to ask?
If not, thank you for coming!