Shredding: What to shred, what to keep

Hawthorne's Shred It Days get rolling again in a couple weeks - on Sat. Feb 2, we'll hold our first of 8 Shred It Days this year. They'll be held the first Saturday of every month (except July, when we're cooking up a special event, to be announced later.) For a full list of our events this year, visit eHawthorne.org. You can bring up to 3 boxes of materials to shred - don't forget your old credit cards - they can be shredded too!

Many members have asked us how to decide how long they should keep documents and what to keep and what to shred. Here's a guideline from the Consumer Reports Money Adviser, January issue and the Credit Union National Association (cuna.org):

YONKERS, N.Y. (1/8/08)—If getting rid of clutter and unnecessary paperwork
is tops on your list of things to do this month, make sure you know what you
can--and can't--shred, and when it's safe to do it (Consumer Reports Money
Adviser January).

Bills. Keep receipts for large purchases, and shred the rest after payment clears your credit union, and after the return or refund period expires.

Credit card receipts. Keep them for one year in case you need to return defective goods, then shred them.

Credit card statements. If they contain tax-related expenses, keep the statements for seven years in case you're audited by the Internal Revenue Service. Otherwise, keep them for one year and then shred them.

Credit union monthly statements. Keep monthly statements that contain tax-related expenses for seven years. Otherwise, keep them for one year and then shred them.

Investment account statements. Keep year-end statements for seven years, but you can shred monthly or quarterly statements as new ones arrive.
Retirement statements. Keep year-end statements for your 401(k), individual retirement accounts (IRAs), and Keogh plans until you retire or close the account, and keep Form 8606 if you've made nondeductible IRA contributions. Shred quarterly statements after you receive your annual summary and verify that everything is correct.

Pay check stubs. Shred the stubs after you receive your annual W-2 and verify that the information is accurate. Keep the last paycheck stub of the year.

Tax records. Keep a copy of all 1040 tax forms permanently. Remember: The IRS has three years to audit your return, but if you underreport your gross income by 25% or more, the IRS has six years to challenge it. And if you file a fraudulent
return or don't file one at all, the IRS can go after you at any time.

One final tip: Cut down on the amount of paper that flows into your home. Register with the Direct Marketing Association at the-dma.org, and opt out of preapproved credit card applications at optoutprescreen.com; you'll see a dramatic decrease in the number of preapproved credit card offers and other direct mail pieces that fill your mailbox.

Also, sign up for estatements! That reduced the number of monthly statements you'll need to shred!