RIM: Part three, retention schedule


One of the most difficult things for many people is figuring out how long to keep their records. Some people either keep everything “just in case” resulting in a houseful of papers and hard drives full of files. Some people destroy everything “to keep things simple” and then realize they’ve shredded an irreplaceable document or permanently deleted an important file.

A retention schedule will solve many of these problems. It is simply a table that states how long records need to be kept. The retention schedule is our decision-making guide on what to purge and when. If we continue our comparison with the S.P.A.C.E. model of organizing, this is the preparation for “P = Purging.”

Different records need to be kept for different periods of time. How long records are kept depends on:

  • what the records are (store receipts vs. birth certificates);
  • why the records are needed (returning an unneeded item vs. proving you exist);
  • your personal situation (personal purchase vs. claiming for a business);
  • where you live (different countries have different laws, rules, and regulations).

For some documents, we can provide some basic guidelines. Jeri wrote great articles on what receipts to keep and what to toss, and what documents are worth saving. Vital records and documents that are hard to replace should be kept forever (e.g., birth certificates, citizenship certificates) or until superseded (e.g., wills, insurance policies).

Because this is the world-wide web and our readers are very diverse, it is almost impossible for us to provide retention periods for specific documents. Here are a few suggestions as to where you can do research on determining retention periods for various types of records.

  • Your country’s taxation centre. The IRS in the United States, the CRA in Canada, and HMRC in the U.K. all provide information about document retention for individuals (your own personal documents) and small businesses.
  • Bookkeepers, accountants, lawyers, notaries, investment advisors, and bankers. Some of these professionals provide retention guidelines on their websites. Just be sure that they are located in the same legal jurisdiction as you are. You may wish to book an appointment with an expert to discuss your specific situation.
  • Medical professionals. Ask your doctor, nurse, or social worker how long you should keep health records. This is especially important if you’re claiming health and/or disability benefits.
  • Your employer. Many employers will provide guidelines on how long to keep your employment related records such as receipts from a business trip, medical records due to work-related injuries, performance reviews, etc.

If you manage a small business:

  • Business development groups, either government or non-profit, usually have resources that are available on document retention for your country/state/province etc.
  • Your industry association may have retention guidelines specific to your type of business. For example, someone who installs fireplaces may need to retain different records from someone who operates a cleaning service.
  • Other resources may include the Departments of Labour, Occupational Safety and Health, and Workers Compensation division. Even if you do not own or manage a business, these agencies may provide useful information on how long to keep certain files in your own employment records.

Determining how long to keep your records may take some time but don’t get discouraged. Keeping only the essential information will save space — both physical and virtual — and it will save you time should you decide to convert your paper records to electronic format. There’s no point in scanning documents you could destroy.

Once completed, your retention schedule will look something like the table below.

In the business world, the “Citation” column is the reference to the legal or policy requirement to retain the document. For your personal records, you can add where you found the record retention information (e.g., website, name of insurance agent, banker, etc.) By doing this now, it will make it easy later on when you need to refer back and see if there are any updates. (HINT: We’re preparing for the “E = Equalize” step in the S.P.A.C.E. model of organizing!)

Remember, if two different citations state different retention periods, you need to keep the records for the longer period. Let’s take a look at an example from my own records. When we live in Canada and buy fuel for our car we keep the fuel receipt until we reconcile it with the bank statement then throw the receipt away. However, while we were living in England, due to our visa status, we were eligible for tax exemptions on fuel. We had to keep all of our fuel receipts and submit them every quarter for reimbursement of taxes. Because this was a government reimbursement, we are required to keep those fuel receipts for the same duration as we would keep our income taxes.

Coming up next, disposition and assigning storage location.

 

Also in this series:

Post written by Jacki Hollywood Brown



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