In Pursuit of Paperless Personal Finance

I'm swamped with paper. This is partly because I'm a packrat, but mostly it's due to the never-ending bills, statements, receipts, policies, and special offers that flood my desk. The paperless office once seemed like a silly goal to me, but lately it's become a holy grail. Spurred by Leo's adventures in minimalism and my own desire to get rid of clutter, I've begun to explore ways to move my money into the 21st century.

Here are eight ways to begin moving toward paperless personal finance:

  1. Reclaim your mailbox. Use OptOutPrescreen.com to stop credit card and insurance offers. Stem the tide of junk mail with the Direct Marketing Association's mail preference service. Cancel unwanted magazine subscriptions.
  2. Consolidate accounts and close those you no longer use. Reduce the number of credit cards you carry. If you have bank accounts at multiple locations, combine them at a single bank. The fewer accounts you have to track, the less paper you have to deal with. (Be aware that closing unused credit card accounts will cause a temporary ding to your credit score.)
  3. Use electronic billing. If you have a choice between paper and paperless, opt for the latter. Not only will this reduce clutter, but it can also save you money. I save $2/month through electronic billing for my auto insurance. Now I'm considering whether it's worth the $5/month cost to sign up for electronic billpay through my credit union. When I calculate how much I'd save on stamps, and count the $2 I've already saved with my insurance company, I could move to completely electronic bill payments for a net cost of $1/month.
  4. Computerize your checkbook. For years, I've used Quicken to balance my checkbook. This is probably normal for young adults, but many of my middle-aged friends still balance their checkbook by hand. One couple I know began using Quicken to track their finances this summer, and are blown away by how easy it is to use. Even a simple spreadsheet can reduce the amount of paper you're shuffling.
  5. Photocopy documents. I have a friend who, at the end of each month, photocopies his financial documents and places them in a three-ring binder. He's been doing this for years. While not quite paperless, this is a great option if you don't have access to a scanner. It sure beats my stack of shoeboxes!
  6. Scan receipts. My accountant uses a $900 scanner that automatically converts documents to PDF files. You don't need anything so fancy. My sister-in-law scans her receipts and bills and saves them to her hard drive as jpegs, vastly reducing the amount of paper she keeps on hand.
  7. Use the web. Online apps offer smart ways to track your finances while reducing clutter. Due.com is a web-based personal finance program with a community element. Shoeboxed lets you scan or photograph your receipts and organize them online.
  8. Know which financial records to keep (and how long to keep them). Purge your archives. For years, I've kept every financial document that comes into my life. I literally have dozens of shoeboxes in storage filled with financial documents, most of which I no longer need. By learning which documents you need to keep, you can be sure that you're not storing useless paper.

Paperless personal finance isn't without its pitfalls, of course. Keep the following best practices in mind if you decide to pursue this route:

  • Backups are important. Have a system to protect yourself in case of theft or hardware failure.
  • Avoid digital clutter. Don't let your physical mess become a digital mess.
  • Check for errors. Remember to always review your bills and statements to be sure they match your receipts.

I plan to utilize several of these ideas. I've already opted out of most junk mail, and I already use Quicken to track my accounts. Now I'm going to sign up for electronic billpay through my credit union. I'm also going to begin scanning bills and receipts, converting them to PDF.

I may not be able to eliminate all paper from my life, but I'm going to give it a try!

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Catherine
Catherine
12 years ago

Wow, your credit union actually charges for online banking? Mine used to charge, then stopped charging if you paid three online bills a month, and now it’s totally free. I also cut off the paper statements years ago. It’s great! Unfortunately, my husband is such a packrat that we still have too much paper on hand for me, but at least some things are under control!

Verena
Verena
12 years ago

For scanning documents, I highly recommend the Fujitsu ScanSnap 500M (this is the Mac version, there is a PC version). It is not cheap at ~$450, but it is a sheet-fed scanner that immediately scans both sides of a document, and it comes with Adobe Acrobat bundled in. I used Mac applications ReceiptWallet to file bills and receipts, and DocumentWallet for everything else, like tax documents and manuals. Unless I need to keep something for tax purposes, it gets recycled or shredded immediately. I have also signed up to GreenDimes, a service that will cut down on your junk mail.

Mike Stankavich
Mike Stankavich
12 years ago

I have been using a Sharp AL-1655CS scanner/copier with Acrobat for scanning all finance correspondence for about two years now. Having everything in PDF has been very helpful and does save a lot of file space. Like Verena, I immediately recycle or shred everything immediately after scanning with very few exceptions. I haven’t used any organizing software beyond a simple folder structure beneath my My Documents directory on my primary Windows box. The one problem I am starting to run into is that I would like to start archiving off some of the older documents but haven’t found a systematic… Read more »

Eric
Eric
12 years ago

Online bill pay can be a little tricky. When you authorize payment, your account is immediately debited (not after the “check” has cleared.) If your bank or credit union sends payment to the payee electronically, there should be no problem. But if your bank or credit union sends a physical check, and for one reason or another the payee does not receive the physical check, it can be a hassle getting the money back that has already been debited from your account. (As you have probably guessed, I speak from experience.) By the way, my Teachers Federal Credit Union online… Read more »

Greg Smith
Greg Smith
12 years ago

NeetRecipts will have a mac version in 2008. Or so they claim.

J.D.
J.D.
12 years ago

I just realized another way to cut down on paperwork: pre-pay bills when you are able. This won’t appeal to those who are opposed to giving “interest-free loans” to banks (or the government), but if your goal is to obtain peace-of-mind, this can be a viable option. At the beginning of June, I had enough free cash to prepay the cable bill and the internet bill until Novemember, so I did it. It’s been nice not having to fuss with these each month. And in a way, I am earning interest. By pre-paying my $12/month cable bill, I’m saving 41… Read more »

MITBeta
MITBeta
12 years ago

I get some bills as “e-bills” through my bank’s online billpay system. For some reason, techie guy that I am, this still makes me a little nervous. My bank doesn’t send me statements, but I can download them as PDFs for the last 18 months. I would love to reduce the amount of paper in my life and just need to setup a system in which to make that happen. I like the scanner idea, but still wonder if it will take more time than it’s worth. I’m not interested in spending $450 to reduce the amount of paper that… Read more »

Cooper
Cooper
12 years ago

THANK YOU for the Opt-Out Prescreen link! Ever since graduating from college, the number of credit card offers I receive a week has been insane. Discover even keeps sending me an offer for a card I already have with them. I’m thrilled that there is something I can do to stop this kind of pointless waste.

Modern Worker
Modern Worker
12 years ago

Going paperless has done wonders for my organization, and thus productivity =)

Kristina
Kristina
12 years ago

My cellphone company has an option to charge your cellular bill to a credit card. Since I pay off my credit card each month, this is an easy way to earn a bit more “cash-back”. A few days before my cell phone bill is due, they charge my card. I then pay it off with the rest of the month’s charges and avoid using a stamp or writing a check. I’m already signed up for paperless billing from my credit card– they send me an email reminder instead of a paper statement. Of course, this is not a good option… Read more »

Rachel May
Rachel May
12 years ago

I’d seriously consider calling your credit union and telling them that you have the option to move to a bank that doesn’t charge you a fee to bank online and use online bill-pay. I’m not saying “threaten to” move banks, but telling them that it IS an option might get you somewhere. Worked for me.

Melissa A.
Melissa A.
12 years ago

I don’t get any paper bills anymore. In fact, I rarely get mail aside from take-out flyers. I kept meaning to put a “no-flyers” sticker on my mailbox, but then I forgot, and now I’m moving so I don’t really care 😛

Dan Englander
Dan Englander
12 years ago

Hey everybody! I’m Dan from Shoeboxed.com. We’re excited that so many people have found our site useful. Feel free to e-mail me personally with any comments or suggestions you have about us. We love feedback!

Clutter be damned!

Dan

dan @ team.shoeboxed.com

SAHMmy Says
SAHMmy Says
12 years ago

Skip the credit union bill pay service at $5–it probably has a lag time comparable to snail mail anyway. Pay online directly through each provider’s site, where you can often choose an option for paperless billing as well. I can run through the eight sites I pay through each month in about 5 minutes–quicker than writing out checks; about the same as using my bank’s site for bill pay–but free.

Matt Wolfe
Matt Wolfe
12 years ago

I am trying to get more organized and get digital with everything. I’m almost there. All bills are handled online through my bank, I’ve canceled all junk mail and I have very few credit cards. Now I just got to do something about all these receipts. I’ll probably look in to one of the options you’ve mentioned.

Mike Stankavich
Mike Stankavich
12 years ago

In response to JD’s comment about prepaying cable and internet bills, I’d like to mention that I have been able to put many of my recurring bills on autopay with my Costco Rewards Amex. I pay off the card every month and build up some pretty nice rebates. In fact I used that rebate to buy the Sharp scanner/copier that I mentioned in my earlier comment.

The net result is that I actually get an interest free loan from Amex rather than giving the vendor an interest free loan from me.

Marc Hedlund
Marc Hedlund
12 years ago

Thanks for the mention of Wesabe, J.D. One note: our Firefox extension lets you capture confirmation page receipts from your web purchases, and upload an image of the receipt directly to your Wesabe account. You can also upload PDF or image files without the Firefox extension. I’ve been using this to cut down on the “please print this page for your records” notices that I print and never look at again.

More info here:

http://www.wesabe.com/page/firefox-snapshot

Thanks again!

Marc Hedlund, Wesabe

Justin
Justin
12 years ago

You might also want to check out yodlee.com to organize all of your accounts. I’ve been using it now for a couple of months and love it. It’s nice to only have to log on to one site to check everything. The budgeting and graphs of spending are great. Good post, the top 25 web apps links is great.

Leslie
Leslie
12 years ago

I have been using online bill pay from my bank for years now (it has always been free for me). Thanks to this post though I finally got around to going to my USAA account and going paperless. I have a credit card with them as well as my life, home, auto, personal property and umbrella policies. You can only imagine how much paperwork I get from them monthly. Well, now I will be getting it all online with e-mail reminders when a new document has been posted. This will most likely free up an entire drawer of my file… Read more »

J
J
12 years ago

You are all spending too much money on scanners. You can buy the cheapest scanner you can get from your local office store and run a program called pdfcreator. It is at http://sourceforge.net/projects/pdfcreator/. This program will install a print driver that will convert anything you can print into a PDF. So jpgs, excel spreadsheets, webpages can now ALL become pdfs. By the way, this program is also the price that everyone on this website loves: FREE.

Sanjiv Swarup
Sanjiv Swarup
12 years ago

I could not agree more.
My two bit.
I use http://www.edeskonline.com because it INTEGRATES all my information: eg my website’s content-management system

considerphi
considerphi
12 years ago

I use CutePDF writer which allows you to print anything to PDF, it just shows up as one of your printers. So when I get an online receipt or something I just print to pdf and save it in a folder with YYYYMMDD – Site/Order.pdf as the name. Works really well and CutePDF writer is free and awesome. If you scan stuff you can also “print” to PDF.

olivieri
olivieri
12 years ago

I have been using my digital camera to take a picture of all documents I want to keep. You actually get much better quality than a scanner and its much faster! Plus I have small sony cybershot so I usually have it on me. The zoom is great so you really capture the true detail of most documents. The trick is to snap a pic of the document right when you get it, then shred it.

karen
karen
12 years ago

Be careful with all the fine print when you do online bill pay. I still pay my electric company with a check because buried in the agreement is a $5.00 “convenience fee” for paying online. I should pay them extra so that they can get my money faster. Riiiiight.

Louise
Louise
12 years ago

I have been using Paytrust on-line bill paying service for over five years and have not received a paper bill in over three years. In fact, my paper mail is so unimportant and of such limited quantity that I only have it forwarded to me once every 4 to 10 weeks.

I wrote about my experience with Paytrust here:
http://ourodyssey.blogspot.com/2007/08/website-wednesday-on-line-bill-paying.html

MONEY BLUE BOOK
MONEY BLUE BOOK
12 years ago

I use Yodlee Powered Fidelity Full View to aggregate my accounts. I also have paperless bank and credit card statements along with automatic payments to streamline the process. With only a few clicks I can view my personal balance sheet and make payments. I can’t imagine the chaos and horror of going back to paper documents…(shudder)

-Raymond (MONEY BLUE BOOK

Marc
Marc
12 years ago

I use a digi camera too (Canon Powershot SD300) at the 1700px + settings. It’s fast and the quality is still legible, even enough to print out a copy if you need it.

Brian
Brian
12 years ago

One thing I do is have a trash can within arms-reach of my mailbox. Anything that is junk mail and that can be tossed without having to be shredded doesn’t even make it into the house. On a good day, about a third of the mail we get ends up being brought into the house.

brad
brad
12 years ago

I stumbled upon a wonderfully simple way on the Mac to save electronic receipts rather than printing them out (for example when you buy something online). Just hit “print” on the web receipt or email receipt, but instead of printing to your printer, click the “PDF” option in the dialog box (all Macs running OSX offer this option, it’s built in), and then from the dropdown menu choose “Save PDF to Web Receipts Folder.” This will create a folder in your Documents folder called Web Receipts, and the PDF will be saved there. That’s all there is to it. I… Read more »

Christopher Harley
Christopher Harley
12 years ago

Online Billpay through my bank has been a fantastic time saver. I too scan and trash all mail items worthy of being kept. The one tip I’d like to add for Mac owners is an application called Combine PDFs from http://www.monkeybreadsoftware.de Now, every time I create a PDF of a bill or document I combine it to the chain of PDFs I’ve already created. It’s a nice, compact file management trick. no more stray items. Combine as you see fit.

John Byrne
John Byrne
12 years ago

I have been reading the posts and there is alot of interest in the paperless idea, which I think is good. KIXZO offers a way to organize these paperless documents. You can also email and fax from the software. Check out KIXZO.

Sandy
Sandy
12 years ago

I have online banking with USAA and it’s free. The only 2 checks I write now each month are 1) for my mowers and 2) for my association dues with a coupon from the coupon book. I could set this up automatically, but haven’t gotten around to it. One feature I like about online banking is the ability to prepay everything when I go on vacation. I still get all my bills in the mail though and the only reason I do this is because I’m worried, what if my computer crashes? I know I could call the companies to… Read more »

Steve
Steve
12 years ago

Regarding “Combine PDFs on the Mac”, this action is already built into the Automator. You can combine PDFs just by creating an Automator workflow – no extra software is required.

reinkefj
reinkefj
12 years ago

May I point out Paytrust? For $12/month they will receive you paper bill and do web bill pay for you. I’ve been using it for a while and that is one way to not even handle the paper in the first place.

Scot Longyear
Scot Longyear
12 years ago

Great article. I just found you and have you on my RSS. Great stuff. Thanks so much. A quick question. I have looked at different budgeting/financial software and ended up using a program called Money Map from Crown Financial Services. I was hoping to use something like Quicken, but didn’t see that it had a key feature – that is, allocating a monthly amount that accrues over time to make quarterly or yearly payments. For example, taxes and tags for my vehicles are due each year. Let’s say they are 1200. I need 100 allocated each month in that line… Read more »

shen deshayne
shen deshayne
12 years ago

have you tried mint?

Mint allows you to view all of your banking and credit card transactions side-by-side, making identifying all of your transactions much easier and faster than ever before.

http://mint.com/

Kind of a quickbooks for us younger ones…

Rich
Rich
12 years ago

For those looking for an easy and cheap (as in free) way to organize their files, iTunes is capable of cataloging PDF’s.
I wrote a quick tutorial on doing this on my site:
http://www.freefrommoney.net/organization/easily-organize-your-financial-documents-using-apple-itunes/

Carter Kirkwood
Carter Kirkwood
12 years ago

I noticed your article mentioned photocopying documents and scanning receipts. Have you tried to receiving e-documents from financial institution websites? Any problems with that?

Donna Minter
Donna Minter
12 years ago

I recently purchased a new scanner when old one died. The Canon Canoscan LiDE 90 has the pdf function (works great). It was $89.95 at Staples store. They gave me their website price of $79.95 when I mentioned it. It is light weight, small as my laptop, and hooks up to my computer with just a usb cable.

Ben
Ben
12 years ago

Great article. In addition to a quality backup system, you might also consider encrypting your financial records in the same way you would store them in a locked file cabinet. I keep all of my statements and tax records in an encrypted volume on my computer with a free open source program called TrueCrypt. It is very seamless and works just like any other partition on your computer.

Tam
Tam
11 years ago

I hate scanners. I use shoeboxed, as mentioned in the article. They scan and do the data entry for me. Worth every penny.

Alex Rinehart
Alex Rinehart
11 years ago

I had a similar issue with electronic deposits with my insurance company. I changed this by paying my premium in one lump sum so that I only incurred the charge once…then I would save the amount in a subaccount in my ING savings and next time the payment was due I already had money waiting for the expense.

Phil
Phil
11 years ago

Hmm – I don’t know how “far back in the pack” this post might be – but checkout the Fujitsu ScanSnap Scanner – I use it with a MAC, along with an online database for tracking expenses for my business. It’s an outstanding unit!!

Mrs. Accountability
Mrs. Accountability
11 years ago

I’m a little scared to go paperless… the part about backing up regularly is what gets me. I would need to have a really good backup system happening automatically to feel comfortable. Although I do have to say receipts fade so quickly that I end up making electronic copies for my husband’s business AND saving the receipts also.

Chris C.
Chris C.
10 years ago

I just found this article, and thought I’d update it with a recent purchase my wife and I made. It’s an Epson WiFi printer. The only thing we have connected physically to it is a power cord. The really cool thing is that other than being able to print in 1200dpi (or possibly higher), is that we can wirelessly scan to our computer, and it has a sheet feeder on the top that you can use but don’t have to. It also allows us to simply start one of our laptops which connect to the printer automatically. Then from the… Read more »

Steve K
Steve K
10 years ago

I rarely use my scanner, you can easily get a free print to PDF conversion tool for your PC or OS-X does it without an extra tool. All you need is electronic billing. All of my “billers” have a web site to review bills and print (to PDF) bills. Payments are PDF printed screen shots of the payment on line or on my bank site.

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