It's vital to keep family records

February 07, 2003|by LYNN F. LITTLE

Why keep records?

It's the sensible thing to do. Think of your household as a mini-business, performing the tasks of planning, buying, saving and investing, only on a smaller scale. Some records are required to assist in tax preparation. Others are needed in case of a crisis, such as death, fire or theft. Others are necessary to show proof of payment and ownership of property. Records provide a useful summary of financial situation, medical, employment and lifestyle history. It is critical that family records be maintained to ensure easy access to necessary information when needed.

What to keep?

Basic records are valuable papers or documents that everybody should keep. Personal records used frequently include driver's license; health, life and car insurance; car registration; identification or citizenship information; and information on personal health, such as allergies, disabling conditions and blood type. These are records that should be easily accessible for use anytime.

Personal records also include family health records; birth, marriage, death and divorce certificates; deeds; leases; contracts; wills; and military and social security papers.


Records for financial or equipment emergencies include a list of credit cards, card numbers, and contact numbers of companies. Guarantees and warranties for household items, as well as appliance manuals, should be kept in a safe place.

Records needed monthly are current family spending plans and budgets, unpaid bills and loan payment books. Financial records prove income and expenses. The IRS does not require records kept in a particular way, so keep them in a manner that works for you.


Where an individual or family keeps an important record will depend on how often it is used and whether it is difficult to replace.

The main places for keeping documents and records are: a bank safe deposit box or a fireproof home storage container; wallet or purse; or home filing system.

A good rule is to keep records in a home filing system unless it's a legal document or one that will be difficult to replace or duplicate. The best place for these is in a safe deposit box or in a fireproof, theft-proof storage at home. Home storage units should be able to withstand heat of 1,700 degrees for one hour.

Know the location of important papers. Have an updated listing of your valuable papers and their locations. Make at least three copies of your valuable papers inventory and keep one in your home file, keep another in a location not in your home, and give one to a relative, trusted friend or attorney.

If valuable papers cannot be located, replacements need to be obtained as quickly as possible. Most papers must be replaced by the issuing agency or organization. Birth, death, marriage and divorce certification can usually be obtained from the office of vital statistics in the capital city of the state where the event occurred.

For information on obtaining records from other states, write the Consumer Information Center, Pueblo, CO 81009 and ask for the leaflet "Where to Write for Vital Papers." There is a small fee for this publication.

How long?

You don't have to save everything forever. Even the best record-keeping system will not fill your needs forever. At least once a year, plan to review your files and do some good housecleaning. January and February may be a good time for a record-keeping overhaul since tax time will require you to look at your financial picture.

When reviewing records, carefully consider the value of an item before discarding any related records. All records that might be used as proof of ownership should be retained. In addition, keep records that might be necessary for resale purposes, those that relate to income tax deductions and others that might have future value as reference for specific financial transactions. These include verification of the original cost or value of property and major home improvement costs. When in doubt, don't throw it out.

Certain family records need to be kept indefinitely. The following are records that should be kept permanently: birth certificates, citizenship papers, marriage or divorce certificates, military records, wills, current insurance policies, income tax returns, employment and education records, credit card information, information on pension records and family health records.

In making the decision to discard records, check current IRS regulations or ask an accountant. The following are examples of items you might discard: bank statements and receipts of transactions for accounts that are closed; canceled checks that are not needed as receipts for proof of purchase or income tax purposes; records of appliances that have been replaced; warranties which have expired; and care instructions for garments that have been discarded.

The key to efficient storage of records is to keep those slips of paper only as long as you need them and to be able to find the records when you need them.

For more information or personal and financial record-keeping, send a self-addressed, stamped (37 cents), business-size envelope to Maryland Cooperative Extension, Washington County Office, 7303 Sharpsburg Pike, Boonsboro, MD 21713. Mark the envelope "records."

Lynn F. Little is extension educator for Family & Consumer Sciences with Maryland Cooperative Extension in Washington County.

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