Thu07242014

Business & Real Estate

To keep, or not to keep?: Shredding guidance for paper records answers questions

If your list of spring-cleaning chores includes doing something about those boxes of old receipts, credit card statements and tax records, keep in mind that clearing the clutter isn’t the only incentive – or concern – when discarding old paperwork.

Those financial forms could become a potential gold mine for identity thieves.

Experts agree that most identity theft occurs in low-tech ways such as stolen wallets and documents. Storing documents at home could expose you to identity theft if someone breaks in and identity thieves pick through trash looking for personal information.

“It’s important to take steps to protect yourself from identity theft when storing or disposing of documents that have personal, identifying information on them,” said Jennifer Leuer, general manager of Experian’s ProtectMyID.com. “Most of us know we need to keep some financial information on hand, but many people are confused as to what to keep, how long to keep it and how to dispose of it safely when the time comes to do so.”

Disposing of documents is fairly easy, Leuer said. Experts advise you use a cross-cut shredder to destroy documents. As for what to shred, you should destroy unneeded items that bear account numbers, birth dates, Social Security numbers, passwords, PINs, signatures, full names, addresses, phone numbers or e-mail addresses.

But what should you keep and for how long? For most people, the following guidelines will suffice.

• Pay and shred immediately: Phone bills, utility bills and credit card statements – unless you need them for taxes or as proof of purchase.

• Keep for one year: Bank statements. pay stubs, medical records – but longer if there’s a question over reimbursement or insurance.

• Keep for approximately six years: Tax records, including copies of returns and supporting documents, documents relating to the purchase or sale of a home, or payment for home improvements.

• Keep longer: Insurance records should be kept as long as the policy is in effect, plus five more years; hold on to IRA contribution documents until you withdraw the money, but shred quarterly statements; warranty documents should be retained as long as the warranty is in effect.

Spring-cleaning season is a great time to begin minimizing the amount of identifying paperwork you keep in your home. Begin by shredding and discarding any backlog of documents, and then purge each year as documents become obsolete.

Throughout the year, be sure to follow basic identity theft protection measures.

• Never carry your Social Security card with you in your purse or wallet.

• Some communities now host “shred-a-thons.” People who face an overwhelming amount of paperwork that needs shredding can participate by bringing documents to a central location for shredding. You can find a shred-a-thon by searching online.

• Use a secure mailbox, such as a post office box, for outgoing mail, especially checks and bill payments.

• Keep personal information – including financial documents – in a secure place, especially if you have roommates, employ outside help such as a cleaning service or babysitter, or have work done on your home.

• Consider switching to electronic bank statements and e-billing. Most banks will now allow you to stop receiving paper statements in favor of receiving electronic statements delivered through their secure systems. Many credit card and utility companies offer the same kind of service for bills.

• Consider using an identity-theft protection product that monitors credit, scans the Internet for your information and alerts you to more than 50 indicators of fraud that may be a sign your identity has been compromised.

“Keeping only what you need, for only as long as you need it, is an important step that can help you stop identity theft from happening to you,” Leuer said.

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