Quick Details on QuickBooks
I use QuickBooks Pro. It is well-seasoned software for financial management. This database is designed to store all the static data, such as account numbers, addresses, and contact names, and has space for notes where you can keep information such as passwords or serial numbers. QuickBooks is flexible enough to manage financial details down to the date, invoice number, and penny, which is required in a business environment. But it is also forgiving for household finances, where there may be an account called “Mad Money” that doesn’t require such stringent tracking. And, it has a budgeting feature that will fill in a new year’s budget with last year’s numbers, providing a head start on this annual planning process. QuickBooks is a good product that can pull together a bunch of what I call “financial fragments.”

Easy Computer Backup
There is a file folder in my computer under My Documents for the QuickBooks file and paperless document pdf records. I use two computers but keep these working files on my USB thumb drive, allowing access to my finances and records on either machine. It is set to backup the file to the computer hard drive each time it is closed. And because I use two machines, this provides effortless backup to two locations. Plus, each machine is then independently backed up on a schedule.

Everything In Its Place
My paper files are organized similar to the layouts of an Income Statement and Balance Sheet. Any documents that have to do with income or expenses, like on the Income Statement, are filed by date, not alphabetically. This includes items such as the power bill, the phone bill, most debit or credit card receipts, food, gas, supplies, etc. I keep a box in the back of my file drawer and just throw such documents in as I am finished with them. That way, January documents wind up on the bottom and, as time passes, December’s documents will be on top of the stack. To look something up, I check out QuickBooks first, which is usually as far as I need to go. But if I need to find the physical piece of paper, then I know the date from the computer, and can find it easily in the stack. At the end of the year, I archive the box into storage and put an empty one in its place. A business may use 10 boxes or more in a year, whereas one box is usually sufficient for a year of household finance records.
Documents that affect the Balance Sheet are usually considered permanent files and don’t get boxed up and archived at year’s end. Instead, I label a file jacket for my assets and inside have a file for my bank accounts, real estate, and investments. There is the file jacket labeled “Liability.” This is the place to keep files on my credit card account and loans (although the monthly statements for such items—if you haven’t gone to paperless statements—are still filed by date after they are reconciled and sent to the attic at year’s end).
I have a file jacket labeled insurance and keep a folder with my auto, life, & health insurance policies. And a file jacket labeled taxes with a copy of each year’s tax returns there.

Safe and Sound
I keep one extra file jacket in my permanent files called “Safety Deposit Box.” This holds a copy of everything in my bank box, as well as the key. When I see the annual bill for the safety deposit box, it triggers me to review the contents and make any necessary changes. That means an annual review of my will, life insurance, and other insurance policies, as well.

Powered By Common Sense
Common sense makes this system work well. First and foremost, be consistent. Recognize redundant items (such as monthly bills from the same company) and handle these items the same way every time. QuickBooks has a feature that lets you memorize transactions to be entered again automatically on scheduled dates. Also, use the note section in QuickBooks to put good memos on transactions so you’ll remember relevant circumstances and information later. Another rule to live by: reconcile statements. Using QuickBooks, this should only take a few minutes each month and pays major dividends when you find discrepancies and resolve them in a timely manner. If you purchase an asset, take the time to determine basis when you enter the transaction. I can’t tell you how many times I’ve done tax returns for people who don’t know the basis of the stock they’ve sold.

I’ve tried to outline here a system that works well for me. I have truly enjoyed reading everyone else’s responses and look forward to your future article.

Sincerely, Earl Kelly, Consultant, Accountant, QuickBooks Pro Advisor, Business owner, Practicing in the Richmond, Va area.

Besides all the other advantages, it has a useful search feature. If I can’t remember what “sub-folder” I’ve overly organized something into I can just do a quick search and find it.

Then I can click and send my browser to the bank/credit card, etc., website and another click and it automatically enters my 16 character random password.

You can search the title, user name, url, or the “notes” section (can be any length.) I put most everything into the notes section, those stupid “security” challenge/response sets, even things like mapquest URLs.

I use a thumb drive file as my master keepass database, and after closing the database after every change I double click a little Windows script (batch file) that copies the database over the backup copy on my hard disk. I only make changes to the master memory key copy, but if I know I’m just referring to old data (not going to make changes), I can use the backup copy on the hard drive without inserting the thumb drive.

As a programmer, I check the encrypted database into my source code control system periodically and back it up other ways as well.

I also keep paper files with one year of bills except for things that you should keep longer. Every account has its own folder.

TRACKING CASH FLOW
I track cash flow with a zero-sum budget on paper every month (actually with every paycheck, so twice a month.) I have a list of all expenses that need to be paid and all amounts that need to go into savings. I don’t really bother to keep a record of each budget, since they all pretty much look the same. I have a single “master budget” in a Word document that I use to record all the regular expenses I need to keep track of. When one of those changes I modify the master budget. (For example, I know what my rent is every month and when it is due, and which paycheck to take it out of (my second paycheck of the month) to ensure I’ve got the rent in my account on the 1st. It’s auto-deducted from my account on the 2nd. This amount only changes 1x a year.)

A copy of the master budget resides with my account information, but it’s simple enough that I carry the details in my head.

The remainder is allocated between additional savings and paying bills, with a $100 cushion unallocated until the next paycheck (that $100 will be factored into the next zero-sum budget, and then a new $100 cushion is left unallocated. The net effect is I always have an unallocated $100 in my checking account, and plenty to transfer in from savings if needed.)
Then, I do all my bill paying online and rely on reconciling my checking account and credit card statements to my receipts. I don’t keep a separate register. I just monitor those two accounts diligently and keep a backup of statements in my files.

This works since I don’t write checks unless it’s the only possible way to pay something — I either charge it to a single credit card that gets paid in full twice a month, or pay in cash. Therefore transactions in and out of my checking are kept to a bare minimum.

For any accounts with beneficiary information, I have a folder marked “Beneficiary Info” where I keep a paper copy of all of these records. This keeps all of the beneficiary info in one place.

Finally, any really important docs are scanned onto our computer and the hard copy goes into our safe deposit box. We keep an e-copy so that if we need info from the doc, we don’t have to go out of our way to get to the bank to look at it.

You might also like to try evernote – it’s pretty cool.

http://www.passpack.com

I’m a founder. We built Passpack because both my husband and I had over 300 passwords each to manage! It should do the job for you.

You can print out a copy of your Passpack logj credentials and keep it stored in a lock box. In case of emergency, your family will have access to everything.

Those archives are maintained both in a TrueCrypt encrypted volume stored on a local backup drive & securely in the cloud (see DropBox). For good measure, I also copy it all to a thumb drive & swap those out at the bank safety-deposit box periodically with a note telling generally how to access & then the important people know the master password.

I also put a lot of data into Evernote (more every day) which can copy a secure local DB to whatever machine it is used from & that also offers encryption for sensitive info as needed. I really can’t say enough good things about EverNote so try it if you haven’t already.

Mint is also a tool I use a great deal now since Quicken insists on trying to charge me $80 every 3 years or so in order to continue functioning. With the improvements in Mint, plus the fact that you can export out everything to a
spreadsheet, it’s a no-brainer. The only exception is that I do keep all stock transactions broken out into a simple bought/sold spreadsheet for use at tax time. That together with Mint & the actual statements from the financial firm (paperless again) provides all you need.

I know it all sounds very geek, and of course there are exceptions, but it makes for almost zero paper to maintain, everything you need is instantly accessible from almost anywhere, and I’m fairly certain that one of my relatives could insert a thumb drive & type a password in order to get to all the details in a critical situation.

Mint doesn’t play nicely with my bank. Other than that, they’ve very, very similar. Both lack manual entry of accounts you can’t log into. Both lack savings goals. I feel like they’re very focused on paycheck-to-paycheck folks and don’t emphasize saving.

It’s a great program and I’ve been looking for something that does what this does for a very long time.

I do not think I can attach it here, but it is downloadable for free at my site on the right side. Be sure to enter the appropriate year for which you are entering data on the top row.(I chose to leave 2007 on the downloadable version due to the craziness of 2008!) I do not use colors on my spreadsheets as many do due to the high cost of cartridges, and try to consolidate the columns onto one page printed in landscape mode, so it is very funcational, yet can be a little intimidating.

I print and file this updated speadsheet annually, and it is a real lesson to go back and look at previous years. (This year it was REALLY a lession!) It should not be a lot of work after the first year entries for long term investors. Supporting documents are kept in labeled manilla files and rotated out annually if bulky, although I am gradually working my way into electronic statements.

I have net worth spreadsheets going back to 1987. It is enlightening to see how far you have come over time, and even helps reduce the stress of market fluctuations when viewed over a long time period.

The spreadsheet readily provides the information needed for meetings with my husband when a new investment opportunity arises, and we want to determine if it makes sense within the context of our other investments, or if it would be a good replacement for an underperforming asset. The same can be said for a large expense we are considering. It readily provides documentation for loan applications, as well. Finally, the spreadsheet will provide a basis for the necessary information for an estate executor when the need arises, and access is easily available. Overall, it provides me with a sense of organization and structure which promotes better financial well being.

Stuff I have to do in a timely manner: I take care of some things with automatic deposits (paycheck into savings account) and withdrawals (mortgage, Netflix). And at the end of every month I double check that I have paid my three utilities bills (electricity/water, gas, and phone) and my two credit cards.

Stuff I have to store: Bills go in envelopes in a shoebox until the end of the year when I start a new envelope. So do my will, pay stubs and receipts for donations. Receipts from buying stuff go in a separate envelope for each month. User manuals (stapled to the receipt) go in a box in my closet. Investment records go in a file cabinet. Income tax stuff goes in the booklet and is stacked in my closet. My significant other sort of knows where these things are.

Financial planning stuff: I keep track not only of checks written but also automatic deposits and withdrawals in my checkbook register. I also use some of the other columns to keep track of credit card spending (is if all the money is coming out of the checking account, which it will). Then at the beginning of every month I enter various totals in a spreadsheet. For example, I keep track of how my retirement accounts are doing and how much is available in my different savings categories. (I do this right after my direct deposits and automated stock purchases because then I get to see at least some of the numbers going up!)

As far as how to get thorough—I wouldn’t have thought of using the credit report as way to remind yourself of all your accounts—that’s cool. Another idea is just to record all your automatic deposits and withdrawals (see bank statements) and then keeping adding more whenever new statements arrive. After one month, you should have most things; after 1 year you should have everything.

As for what to record for each of these, it’s hard to say. I used to have a big notebook with everything, but it was too hard to maintain. Now I figure that if I ever need to change my address or something, I’ll go to my financial address book and just check every single website to see if they’re keeping track of my address. But you could go to each website, log on, and look up your preferences.

As for letting someone else into your accounts, you can add a second user to a credit card without putting it in their name. I’d check directly with other financial institutions for what options are available.

A power of attorney is also good but not as perfect as one might hope (hard to actually use sometimes). And of course if you tell someone your userID and password, they can pretend to be you online at least. You’d only want to do things with someone you trust. If there’s some reason other than maintaining your own credit record why you don’t want their name on the account, you might also not want them to have access.

I too have a husband who would be clueless without this (I handle all the finances – he’s an artist). The info is saved on my computer (but not online), he has a paper copy as does my daughter, and I keep a copy in the file cabinet under EMERGENCY.

It’s easy to update and the peace of mind is priceless.

I would like to offer a warning to all the home safe users. Make SURE the safe is bolted down! If not the thief just takes it and has all the time in the world to cut it open. Also most home safes are only fire resistant, they do nothing for floods. We found this out the hard way after a hurricane.

I’m looking into the safe deposit box route.

I guess I always “knew” I needed to be organized with my finances, but never really asked myself WHY. Now that I am clear of my needs, I found YNAB to be perfect (only started in December, so will see if it last for me, but I feel like it will – I actually enjoy using it rather than dread it).

Passwords: I use a .txt file to record most of them and have a master password on my firefox. Not the best security but its simple.

Banking and Investing: Yes! KISS! This is what I am working towards. Right now my money is all over the place.
Ideally:
1 expense (checking) account
1 high-interest savings account
1 taxable investment account
1 roth
1 current 401k

Lastly I just wanted to say thanks for the the tip on the Financial Planning Organizer Kit. It looks well worth the investment to have peace of mind that the important papers are where they should be.

My father, however, has a number of investments spread all over the place.

He has a binder for each account, and puts the statements away as soon as he gets them. At the year end he removes the 2nd prior years statements leaving only the curret year and past year in the binder. All the binders are kept in one place and near the desk he uses to open his mail.

Seems to work for him, and is simple enough to keep up over the years.

So for us statements, insurance documents, tax returns, etc etc including photocopies of the most important info are all kept in a file cabinet in a pretty easy-to-find order, and the account numbers written on the front of the folders.

We have the originals of the more important stuff (immigration documents, passports, home insurance policy & some house purchase documents for example) and a simple list of all our account numbers in a fireproof safe, which hopefully would last a bit longer if the house went up in flames.

I like the book you linked though, it looks comprehensive and smaller than a file cabinet, if apparently unavailable in Canada.

2) Read (and follow) “Smart Couples Finish Rich” by David Bach. He outlines a great organizational system for personal finance. It’s the best filing system I’ve found, and it’s easy to maintain.

3) I’ve created a protected spreadsheet w/ all of my accounts (Banking, Mortgage, Credit Cards, Utilities, Cell phone, etc.). In each set of cells I have: Institution name, Account name, Account number, website link, username, password, security questions. All my accounts are in 1 central location if I ever need to look it up. And from that xls. I can click on any given weblink and go strait to the site.

I have a simple excel sheet I use for all asset accounts and bills to be paid. It lists institution, account #, phone contact, how paid (online, check, etc). This way my husband could in a jam figure things out. It is one page that I print out as well as keep electronically so we could access from any computer.