How long to keep old financial statements

Ask NJMoneyHelp

Photo: picjumbo.com/Viktor Hanacek

 Q. I have all my old 401(k) and IRA account statements in boxes, and I’m running out of room. What do I have to save and what can I get rid of?

A. Ah, yes. The dreaded clutter.

Most individuals tend to keep records for seven to ten years, but technically it is safe to keep seven years of statements for your records, said Douglas Duerr, a certified financial planner and certified public accountant with Duerr Financial Group in Montville.

“This is the statute of limitations for the IRS to inquire on backup, but even seven years can become a large amount of paperwork for individuals,” Duerr said.

He recommends you seven years of year-end statements, and monthly statements for the current and prior year. If you had a large amount of transactions in a certain time period, you may want to keep that one or two statements for your records, tool.

But now, technology can make this all a lot easier, and less cluttery, too.

“Almost every type of statement is available as an Adode Reader file –a .pdf file,” said Michael Gibney, a certified financial planner with Highland Financial in Riverdale. “This makes holding copies almost unnecessary.”

You can simply keep them in a folder on your hard drive.

In case your computer ever dies, you may want to have a second copy on a cloud service, or add them to a thumb drive or other portable device you can keep locked in a fireproof box.

Gibney said the company that issues your statements can provide historical copies for any period you have been a client, so at least you have a backup.

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NJMoneyHelp.com presents certain general financial planning principles and advice, but should never be viewed as a substitute for obtaining advice from a personal professional advisor who understands your unique individual circumstances.