Don't Lose Your Financial Records in a Disaster

Every year there are natural disasters that remind us how easily we can lose essential tax and financial records. After a disaster, you’re more likely than ever to need certain records to file insurance claims or apply for loans.

It’s smart to take the time before a disaster to identify key records, make copies, and find a secure place to store them. Here are some suggestions to get you started.

●You don’t need to copy every tax and financial record. Your banks, credit card companies, and investment brokerages will have records of your accounts and can probably supply details of recent transactions if needed. Your employer will have current payroll records, and IRA or 401(k) plan trustees will have details of your accounts.

●Keep a master list of all account numbers, with a contact phone number for each. That will make it easier to recover information after a disaster. If you handle transactions online, include your user ID and passwords.

●Keep copies documenting the purchase of your home or investment properties. Also keep records of expenses for remodels or other improvements that change your cost basis in the property.

●Your broker should have details of your original investments in stocks or bonds, but copy details of any investments you purchased independently. That includes numbers of U.S. savings bonds that you own.  If you change investment firms, ensure that your new advisor has all cost basis information for your account.

●Make sure your will and estate planning documents are stored safely, either at your lawyer’s office or in another secure place.

●Keep copies of your last three years’ tax returns, even if your tax preparer has duplicates.  Copies of older returns along with supporting documents should be retained if you have carryforwards on your returns.  And finally, include a recent backup disk from your home computer.

The best place to store your records depends on a number of factors. A bank safe deposit box should protect against most disasters. Sometimes a fireproof home safe is sufficient. Wherever you decide to keep your records, take the time to prepare now.

Call us at (219) 769-3616 with your questions, or email them to tlynch@swartz-retson.com.