Until recently, I kept all receipts because for some reason I thought I needed them. I was lazy and didn’t want to organize them. I would get home and put them on the table or leave them in my purse forever. Most of them ended up in the garbage. I got sick of having receipts everywhere and not being able to find the important ones when I needed them. I decided it was time to try to organize the massive pile of receipts I have and keep what I need and ditch what I don’t.
Receipts To Keep
Below is the list of receipts I personally keep. Obviously, there are some other categories that you need to keep for tax purposes if you are a business owner or if you recently bought or sold a home/car. This list is a great way to get started organizing your receipts.
I keep all medical bills & receipts for at least for a year (usually 3 years). This way I know what I spent and if there is a discrepancy I have proof. I go to multiple specialists so I make sure that I keep all of those bills and receipts. If you have a Health Savings Account (HSA) and you use it to pay for a medical expense, you might need to submit the receipt if they need more information. I’ve had to do this twice so far this year so it is important to keep these receipts. You also might be eligible for tax deductions and if you are you will need to keep your medical bills/receipts.
Car Repair and Maintenance
Thankfully have only had one minor repair but I think it is important to keep all of your repair receipts so you know exactly what work has been done on your car. I make sure to keep my maintenance receipts (the most recent 3) so I know what was done on my car and when. This helps me budget for any upcoming car maintenance expenses because I know when my last oil change/tire rotation was and when I got new brakes.
I recently bought a new computer so I kept that receipt because it is under warranty for two years. You should keep the receipt for any electronics or big purchases so you know when you purchased it and when the warranty will expire. If you need to use the warranty, they usually require you to show the receipt. You can also check with your credit card company (if you bought the big purchase on a credit card). Sometimes your credit card company offers a limited warranty beyond what the store offered you.
TIP: You can put the date the warranty will expire in your phone calendar and set a reminder for a month before so if something is wrong with your device, TV, electronic you can make sure to get it fixed prior to the warranty expiring.
I donate monthly to multiple organizations so I make sure to keep those receipts for tax purposes. I found a great article that goes into depth about donation receipts and what you need for tax purposes. This article goes through different types of donations (cash vs non-cash) and the different distinctions between types of donations. I recommend keeping your donation receipts (especially if they are large donations) for 7 years. The IRS has three years from your filing date to audit your return if it suspects good-faith errors and six years if it thinks you underreported your gross income by 25 percent or more.
Receipts To Toss
I usually take these receipts home to enter them into my budget excel file and to make sure it’s not wrong on my credit card statement. Once it shows up on my statement I toss them.
When the restaurant bill hits my credit card statement, I throw it out. The only reason you would want to wait to throw it out is to make sure that the amount on the receipt, including your tip, matches what is charged to your credit card. If you pay with cash you don’t need to worry about that! You can throw away the receipt and not worry about waiting for it to show up on your statement. If you keep track of what you spend daily (like I do) you can throw it out as soon as you enter it into your budget.
If you bought an item you are unsure about keeping, you should keep the receipt until you either 1) return it or 2) take the tags off. Once you take the tags off a clothing item you can throw away the receipt because 99% of the time you can’t return it at that point. If you took the tag off and decide you don’t want it, then try to sell it!
How To Stay Organized
I keep all my important receipts in an accordion (or expanding) folder. Click here for a link to 2 for $9.99 from Amazon that has 12 pockets. You can label the pockets for each category. Now all of your important receipts are in one place! It is a cheap and easy way to organize important receipts (or any other important documents). You can go through the folder once a year to remove all the receipts/bills that you don’t need to keep anymore to make some room for the new ones! For really important documents, like my birth certificate and social security card, I recently got a SentrySafe. This might also be a good purchase for small business owners who have many receipts and documents they need to keep for a long time.
What other receipts do you keep? How do you stay organized? Let me know!