Getting Your House in Order for 2010 & Beyond

Published On: January 2, 2010

NEW YEARS RESOLUTIONS…We all make them…We all break them.  The top resolution that we make, believe it or not, is not loosing weight or exercise.  Studies have shown that the top resolution, year in and year out, is to GET ORGANIZED.

Aside from the fact that everything we do revolves around our organizational skills, or lack thereof, our financial, mental and physical well-being are greatly affected, as well.  In order to make 2010 the year we finally achieve our goal, we need to identify our reasons for wanting to get organized. Start by imagining how much stress would be avoided if this was the year you finally got organized.

One of the biggest components of successful organization consists of record keeping.  When I sit down with Sellers and compile data concerning the repairs or replacements that have been made to major components of the house, they frequently have nothing more than a general idea of the age of the roof, or the year when the bathroom was added, or even the new heater in the basement.  The Seller will often be years off in his or her estimates of time and price.  How much simpler life would be if a journal had been maintained and entries had been made every time a significant expense had been incurred?  START ONE NOW and take a few minutes to jot down expenses as they occur.  It gets easier as you go along.

Even though each family or household must work out its own system, some general guidelines can be helpful.  Ask yourself a few basic questions:

·         Who may need access to necessary information about your family household assets and obligations?

·         Do you have a list somewhere of people who are important contacts, such as your tax counselors, attorneys, bankers, insurance agents, employers, creditors and debtors?

·         Are you sure titles to property and possessions are held in the best way for all concerned?  You may need to meet with an estate attorney for professional assistance.

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A good record system will provide a bird’s-eye view of what happens to property after you die or when a member of your household dies.  Other changes can alter plans too…for example, divorce, illness, loss of a job, retirement.

What happens if your home is burglarized or there is a fire and all of your records are destroyed?  What do you do when you lose track of really important papers?  What can be replaced, and how do you go about replacing it?  Which ones cannot be replaced, and what do you do about those?

Every family household has some important records.  Each of us should have a birth certificate or an acceptable substitute.  It is important that you keep it in a safe place, preferably a safe deposit box.

If you have lost or misplaced birth certificates, the best time to apply for replacements is NOW….before there is a pressing need.

Other important documents to be kept in your safe deposit box include marriage certificates, divorce or other legal papers regarding dissolution of marriage, adoption papers, citizenship records, military service papers and any other document that is either government or court recorded.

If you do not have a safe deposit box, then now is the time to consider getting one.  The yearly rental fee, at your bank or savings and loan company, is quite inexpensive.  A guideline as to what goes in and what stays out of your safe deposit box might be:  Put it in if you can’t replace it or if it would be costly to replace. 

Keeping Tax Records

How long should you keep your tax records?  The Internal Revenue Service has 3 years in which to audit Federal Income Tax Returns.  In unusual cases, the Government has 6 years to collect the tax or to start legal proceedings.  There are NO time limits if you filed a fraudulent return or if you failed to file any return.

But, don’t keep everything for tax purposes.  You can lighten that filing cabinet load by discarding certain checks and bills once they have served their purpose.   For example, you can throw away weekly or monthly salary statements after you check them against your annual W-2 Form.  Save cancelled checks that relate directly to an entry on your tax return.  It’s a good idea to keep your medical bills for 3 years to back up your cancelled checks.

The IRS generally keeps records for 6 years.  If you find that you need a copy of your Tax Return you can obtain a copy by writing to the IRS center to which your return was sent.

Household Inventory Records

Among your important papers keep a household inventory.  If there is a fire or burglary in your home, this record will help you remember what has to be replaced and how much each item is worth.  An inventory should also show the cost to replace it.  Include the model number, brand name, dealer’s name, and a general description.  Having pictures of the rooms and household possessions will make identification or replacement easier.  Go from room to room…making a list of everything.  Don’t forget to include the garage, basement and attic.  Put a price next to everything.  Add everything up to determine what the total replacement cost would be.  Review your insurance policy at this point to determine if your policy needs to be increased.  Even a person who is renting a property needs to know the value of his or her possessions and have insurance in place to cover replacement in the event of loss.

More storage boxes and bigger and better filing cabinets are not the answer to implementing successful family/household records.  They just give us an excuse to hold onto MORE clutter. Go through the paperwork and shred any unnecessary paperwork.

The Dreaded To-Do Lists

Over-stuffed file cabinets aren’t the only things that clutter up our lives.  What about the 101 things that we have to do that we carry around in our brain?  Writing things down and checking them off as we complete the task is a great antidote to that helpless feeling that can cloud our overloaded brains.  We just can’t remember it all!  Juggling all of those schedules in our mind just can’t work.  Keep a “To Do” list and consult it regularly.  Maintain just one calendar instead of having one for the office and one for personal. 

Our personal lives can become cluttered, also.  I know it is almost a cliché, but we just don’t spend enough time on ourselves.  Especially at this hectic time of year, there is not enough time to relax, to reflect, to meditate.  Everyone knows an automobile can’t run without fuel in the tank and regular, overall maintenance.   But none of us allocate enough time to recharge our own batteries.  BE GOOD TO YOURSELF.  Do something you enjoy on a regular basis.  Schedule it on your “To Do” list.

In closing, start keeping better records and let someone in your life know where your records are.  Remember, this is the perfect time to consult with the professionals who can help you achieve your goals of peace of mind:  Accountants, Attorneys, Estate Planners, Real Estate Brokers.   ENJOY 2010….A NEW YEAR…A NEW DECADE!