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Keep Copies For your most important documents, experts advise keeping multiple copies. That may mean keeping one copy in your cloud storage and another on a hard drive. It could also mean keeping one copy in your electronic filing and one hard copy in a fireproof safe.

You need good records to prepare accurate financial statements. These include income (profit and loss) statements and balance sheets. These statements can help you in dealing with your bank or creditors and help you manage your business.

KEEP 3 TO 7 YEARS Knowing that, a good rule of thumb is to save any document that verifies information on your tax return?including Forms W-2 and 1099, bank and brokerage statements, tuition payments and charitable donation receipts?for three to seven years.

Keep records for 7 years if you file a claim for a loss from worthless securities or bad debt deduction. Keep records for 6 years if you do not report income that you should report, and it is more than 25% of the gross income shown on your return. Keep records indefinitely if you do not file a return.

Utility Bills: Hold on to them for a maximum of one year. Tax Returns and Tax Receipts: Just like tax-related credit card statements, keep these on file for at least three years. House and Car Insurance Policies: Shred the old ones when you receive new policies.

Most lawyers, accountants and bookkeeping services recommend keeping original documents for at least seven years. As a rule of thumb, seven years is sufficient time for defending tax audits, lawsuits and potential claims.

Tax returns and supporting documents (keep for at least three years, but ideally up to seven) Pay stubs (keep for at least six months, but ideally up to one year) Social security statements (keep current copies) Year-end retirement fund statements (keep current copies)