Perhaps you’ve received a lot of important mail lately, or maybe it’s time to do some serious cleaning of your home office. Either way, you should be thinking about how to safely dispose of your documents.
While much attention is paid to major, high-profile data breaches at large institutions that affect millions of account holders, it’s important not to forget about the small-time identity theft efforts that can still ruin your finances and credit if you are not careful. Even in our digital age, dumpster divers are still scouring your garbage for any papers that could contain important personal information.
How do you stop them? Crumpling or tearing up these documents is rarely enough. A dedicated thief may find the pieces and attempt to put them back together, especially if they recognize that they make up something important. A check, for instance, is still recognizable, even after being torn in half.
You’ll want to break out the shredder when it comes time to get rid of sensitive documents. By the time your papers go through one of those, no one will be able to put them back together in anything resembling a legible way. But what, specifically, should you shred, and what should you hold on to for your records? That’s the question.
What to shred
You may think that every financial document is important and worth storing. This isn’t true. Though there may be benefits to keeping certain papers intact for a given amount of time, eventually you’ll want to send them to the shredder.
ATM receipts, for instance, are useful to hold onto until you can compare them with your bank statement. But once you’ve seen that everything is in order, shred them. You may want to hang on to bank statements for a bit longer, especially if you want records of large payments. But seriously consider shredding them after a year.
There are some documents that you should almost always keep, but if you need to dispose of copies for any reason, make sure to shred them. The best example is a tax return. The IRS recommends that you keep records for three years after the date you file a return, and seven years if you happen to file a claim for certain losses, like worthless securities or bad debt. Some financial experts will recommend that you keep records for even longer, but make sure anything you throw away is properly destroyed.
Finally, be sure to shred any insurance policies or home financial information – such as deeds or mortgages – when they are no longer relevant. Insurance information should be destroyed once the policy is no longer in effect. Home information should be kept for at least six years after you sell, for tax purposes, and then disposed.
What not to shred
Obviously, there are many important documents that you should never get rid of under any circumstances. To best secure birth certificates, marriage documents, military records or wills, invest in a high-quality fire safe.
But there are just as many documents that are generally safe to dispose of without shredding. For instance, product warranties can go in the trash once they expire. So can any household receipts or utility bills, unless they happen to include payment information. Generally, when deciding whether to shred something, you should be on the lookout for sensitive data that could be used against you.
Invest in identity theft protection
No matter how many precautions you take, the threat of identity theft can always looms large. Help protect yourself by investing in an identity theft protection service like Identity Guard. By monitoring your credit files, Social Security Number and public records, our service can notify you of certain activity that may be indicative of fraud.