When to shred personal documents
For most of us, old documents are generally left untouched in a file drawer collecting dust for years. They may be out of sight and out of mind, but they are still clutter that is taking up space. Even worse, while these documents may be virtually useless to you, they are are a potential gold mine to identity thieves. The easy answer is to shred personal documents.
While it might be tempting to just toss everything every few years, resist this temptation since some documents should be kept for specific lengths of time. You do not want to come up empty in the event you need a particular document. Take control of your files and secure your information by following our guide on what to keep and when to shred various types of personal documents.
What to shred?
While we have certain views on what documents are important, that doesn’t mean that only the important documents should be shredded. There are several less consequential documents that can hold personal information which in the wrong hands could lead to fraud or identity theft. For instance, some of junk mail, most notably credit card offers, could be used by criminals to open accounts in your name and destroy your credit. Before placing any piece of paper in the trash, take a moment to consider if it has any personally identifying information, if so, securely shred it instead. To help you determine which documents to shred, here is a list of items which are considered personally identifying.
- Full names (includes middle name or initial)
- Birth dates
- Phone numbers
- Employment-related information
- Employer identification numbers
- Passport information
- Medical information
- Bank information
- Credit card information
- Electronic or digital account information
- School identification numbers
When to shred?
Note that this list is specific for personal documents. For a breakdown how long business-related documents should be held, see our Retention Guide for Small Businesses.
There are some documents you can shred as soon as you have read or paid the associated bill. You may choose to hold some of these items for up to one month in order to verify charges with your bank or credit card statement. You may also need to hold on to some of these documents for warranties, insurance coverage or tax purposes. Otherwise all of the following items can be shredded immediately.
- Paid utility bills
- Paid credit card bills
- Sales receipts (unless related to a warranty, insurance, or tax purpose)
- Cash withdrawal receipts from ATMs
- Junk mail
- Credit card offers
- Labels from empty prescription bottles
Shred after one year
Some documents may need to be kept for up to one year for comparison, or more commonly in case you need to apply for a loan or dispute a bill. These include:
- Pay stubs
- Bank statements
- Paid, undisputed medical bills
Shred after seven years
This milestone centers around tax related documents. Some sources will tell you that you can shred tax documents after only 3 years, but the Federal Trade Commission recommends keeping all tax related documents for seven years because under certain circumstances the IRS does have up to seven years to audit. Items you should shred after seven years include:
- Tax related receipts (except for home improvement receipts)
- Tax related cancelled checks
- Records for tax deductions taken
Shred personal documents after certain events
There are some documents that do not have a set period of time before shredding, instead they depend upon certain events occurring. These include:
- Auto titles – keep as long as you own the vehicle
- Home deeds – keep as long as you own the property
- Disputed medical bills – keep until they are resolved
- Home improvement receipts – Applies only to homes you own. Keep until the property is sold and any capital gains taxes are paid
Finally, there are documents you should keep forever. These include:
- Birth certificates
- Social security cards
- Marriage licenses
- Divorce decrees
- Citizenship papers
- Adoption papers
- Death certificates of family members
- Tax returns – Some say you can shred these after seven years, but the Federal Trade Commission recommends keeping these forever. If you do shred these, the AARP recommends checking your My Social Security account before shredding to verify your earnings, since corrections will be easier to make if you have your tax returns on-hand.
Now that you know what and when to shred, let’s briefly discuss how you should shred personal documents.
How to shred?
One option is to buy an office shredder. Depending on the type and model, they are generally affordable. However, there are several dangers associated with office shredders. Instead, there is another safer and more convenient option: use a certified service provider. By using a shredding service provider you guarantee the documents will never be reconstructed, and that all of the paper will be responsibly recycled.