Christa Wagner

It’s the perfect time to organize your paper and files for the new year.Attend this workshop, File Yourself to Freedom, and leave with files you will never have to re-organize again.   Attendees will learn how to use the filing product we use exclusively that will tell you where to put your paper and how long to keep it.  The FreedomFiler has a built in purging system designed to help you let go of paper once and for all. We love this product and you will too!

Title: File Yourself To Freedom

When: Dec 1, 2009 6:30 PM

“The FreedomFiler® is the only self-purging filing system available today.
Once you begin using FreedomFiler, you will never again have to take time
out of your life for cleaning  out or reorganizing files!”

If you read our posts, you will find many of them on the FreedomFiler.  It’s a fantastic filing system we use with nearly every single client. We get so many emails about this product which is why you will find a lot of FreedomFiler posts.

Recently, I was talking to my good friend, Debbie Rosemont of Simply Placed, based in Sammamish, WA.  We were talking about the FreedomFiler and how we can best use this tool with our clients.  We both have been using the product for years and many people want us to help them implement the system, but others have different needs.  Here are some ways we can help you with the FreedomFiler.

Ala Carte: You can purchase a FreedomFiler on the website or thru Savvy Solutions.

FreedomFiler eBook:  Since we get so many inquires about this product, we decided to write an eBook with the How To’s and Common Questions.  Contact us to purchase at info@savvysolutionsorganizing.com.

Pre-Made FreedomFiler kit: We can put your FreedomFiler together for you.  We don’t want to see this product become another product that sits on your counter.  Let us put it together for you and you will have functioning files with minimal investment.

FreedomFiler Workshop: We offer workshops where you can build your Freedomfiler in a group setting.  Check our website for our next File Yourself to Freedom Workshop.

FreedomFiler Consultation:  In just a few hours, we can show you how to use the product, how to implement and build your system.  You will have files you will never have to organize again in less than 3 hours.

FreedomFiler File Overhaul:  This is when you have a lot of paper and we need to dedicate time to building your system as well as reviewing your paper.  It takes some times to get thru, but you will love how much lighter you feel in the end.

We love the FreedomFiler and you will too!  Check out their website and do yourself a favor and invest in this system.  If I had one wish for every home, it would be to have a FreedomFiler.  Hang in there, a cure to your paper blues is coming.

So it’s April 15th and it’s tax day.  Whether or not, it was challenging for you to get your paperwork together, it’s a good day to pay attention to the receipts included in your return and to plan for next year.  Create some files to separate your receipts so tax time next year is less of a hassle.  You can use hanging files folders, manila holders, envelopes; find a way to separate your receipts for next year.  Label your tax files according to how you submitted them to your accountant or how you completed your own return.  That could be by category like medical, education, business, etc.  Or it could be chronological if you submit them to an accountable on a monthly or quarterly basis.  We have many posts on this so search by tax and you will find a lot of helpful tax info. 

Here’s to another tax year.  It can be much easier in the future.

As an organizer you will hear me say being organized saves you time and money, and Friday this rang true.  John and I met with our new accountant, which is a complex process for us and can be very stressful.  We have to report taxes in both the US and Canada and it can be extremely overwhelming ensuring everything has been taken into consideration. 

Of course, we use the FreedomFiler to keep our tax papers organized which is vital to our tax success. Our tax files are US Tax, Canada Tax and Savvy Solutions Tax Files by category (advertising, phone, travel, etc.).  It’s a lot to keep organized, but FreedomFiler works like a charm.

Our tax paperwork was organized and prepared and when we arrived on Friday the accountant was thrilled as this made it easier for her to review our situation and complete the return.  She had a few questions for us, but basically it was a simple and stress free appointment.  And the great news is she changed her original quote and reduced the price to complete our taxes by $500. 

Being organized saves you time and money and on Friday it saved us $500 out of pocket.  My husband and I were very happy.

It’s that time of year; tax time.  In my experience, there are two typical scenarios.  On one hand, many people hand over the shoebox of receipts to their accountant and have to pay for the accountant to then organize their receipts and complete their tax return.  That expense can really add up and it’s not really the best use of your accountant’s time.  On the other hand, many people take that same shoebox and now have to organize their own receipts and complete their own tax return.  This also takes a huge amount of time and energy and if you put a price on your time, my guess is the amount would add up quickly.  

Unfortunaly, there is no paper more important than tax paper so I would recommend setting up a system that us more reliable than the shoebox and will save you time and money in the end.  Moving forward I recommend always asking yourself one question for every piece of paper your are considering holding onto.  Ask yourself, “Is this a tax related document.”  If it is a tax related document, then always place this paper with other tax related documents.

If your taxes are relatively simple, for example you only get a W2 (USA) or a T4 (Canadian) and a few other tax related papers, you may only need one folder called tax documents.  But if you have a more complex tax situation, or a business, its recommended to have several tax files.  Examples include: income, charitable donations, medical expenses and investment expenses.  If you have a business you absolutely want to have your receipts separated to save time and money come year end.  Examples of business tax folders are bank statements, credit card statements, automobile expenses, advertising expenses, travel, etc.  These are only examples and your tax section is really up to you and your paper. 

Another consideration would be to ask your accountant or bookkeeper how they would like the information.  Just the other day, I called Alison Martin, a bookkeeper who was working with a client of mine and asked her how she would like to receive the tax paperwork from this client.  She said quarterly, so we created Tax Q1, Tax Q2, etc.  It was as easy as that and really easy for my client and now Alison. 

If you’re still stuck and can’t break the shoebox habit, consider using the FreedomFiler.  We use this product with nearly all residential clients and most business clients as well.  It keeps your tax papers separate from other papers and keeps it separate from year to year.  It’s an exceptional product.  Contact uswith questions regarding your FreedomFiler.

I was working with a client the other day, building her FreedomFiler and taking her through the different types of paper.  I explained to her the tax, permanent, remove replace and resource sections and she felt like she a good handle on these types of papers.  Then she said, “But I just know what paper goes in the monthly section.”  In that same breath she said “What do I do with all my investment report I get every quarter?”

It was funny; because she answered her own question with her other question. I use the FreedomFiler with nearly all residential clients and most business clients too.  It’s a great product because the way you file your paper tells you how long you keep it.  There is a monthly section that I call the irrational catch-all.  It’s the location for the papers we want to keep, but we just don’t have a good reason to, we aren’t sure if we will need again and we just want to keep it for future use.  Love having a place for those.

So getting back to my client and her quarterly investment paper,   I told her to ask herself the following questions:

1. Is this a tax related paper?  No, she is not using this paper on her taxes as the investment company will inform her at the year’s end of any gains.
2. Is this a permanent paper?  No, this is just an update and does not describe you original plan or allocation.
3. Is this a paper that is replacing another version?  No, this is just a statement.  It is not the contract you have with the investment company?
4. Is it a resource?  No.
5. But it is a piece of paper she wanted to keep, even though she really didn’t think she would use or need it.  It felt important.  Yes and using the FreedomFiler we placed it with the other irrational papers by month.

We strongly recommend the FreedomFiler to help you manage these irrational papers and tell you how long to keep them. It’s an exceptional product.  Contact us with questions regarding setting up your FreedomFiler.

In the process of sorting household paper, many of our clients are unclear as to what receipts are considered home improvements, and what are considered home maintenance. So I asked my bookkeeper – who is registered with the IRS which means she is extremely qualified to answer tax related questions such as these. I thought the examples she gave were very helpful in classifying between the two categories.

• Home improvements are structural repairs or additions that will add value to the house, such as adding a new roof, putting a deck on, new kitchen cabinets, etc.  These “improvements” are usually pretty spendy.  If they are paid for your principal residence, there is no tax deduction until the house is sold, at which time they increase your basis in the house and reduce your gain.   If they are paid for a rental property that brings in income for you, they must be capitalized and depreciated, resulting in a portion being deducted each year.
• Home maintenance is just your normal upkeep – - replacing leaky faucets, painting a room, having your lawn mowed, etc.  Maintenance is generally things you do to keep the home from needing expensive “improvements.”  If these items are paid for your principal residence there is normally no tax deduction available.  One exception to that is if you are preparing your home to put it on the market for sale.  “Fixing up” expenses (paid within a window surrounding the sale of the home) can be added to the basis of your home and reduce your gain on the sale of the house.  If the expenses are paid for rental income producing property, they are deductible against those rents received.

The other day I was working with a client and a quintessential filing moment happened. It started out like all appointments, I learned what was working, not working, etc. Then I explained to her the FreedomFiler, which we use nearly exclusively with all clients, and taught her the basic principles of the system. I explained the reason it works so we well is because you file your paper according to use. Makes sense, right? Oh and did I mention she is a bookkeeper?

Then we started creating her files based on her specific needs. As we reviewed her paper we came across a medical receipt from last year (2007) that she did not report on her taxes. Why, because it was with her medical records and she forgot it was there. Using the FreedomFiler, this medical receipt would have been in the tax section. She would not have had to “remember” it, it would have just been there with her other write-offs.

Can’t explain it any better than that. We have too much on our plates to remember everything, especially little details. By using the tools available to us, you can avoid losing on 20% of write-offs because they are in the wrong place.

My client now has all her receipts in her tax section and she is all set for tax season 2008. To order a FreedomFiler, go to www.freedomfiler.com and use our coupon code with our compliments. Contact us to get our coupon code for a discount!

What to find any piece of paper in 5 seconds of less?

Attend next week’s workshop and create a maintenance-free organizing solutions for the home and office. Free yourself from cleaning out your files, forever! Reduce the time and energy required to find and file papers. Have important files like tax documents at your fingertips when you need them. Keep a centralized place for family and property records. Never have to decide what to keep and what to toss.

Workshop Details:
Date: Tuesday, September 16
Time: 7:00 – 9:00 pm
Location:Phinney Neighborhood Center
6532 Phinney Ave. N
Seattle WA 98103
(206) 783-2244

More info here.   We hope to see you there!

Recently I worked with a client who was concerned about tossing old investment statements because they used the statements to calculate the cost basis of their stocks. The trouble with this is that the statements would have to be kept indefinitely, and they take up a lot of room. What’s more, it is difficult to find the information needed and you’d have to rely partly on memory of when you purchased the stock, and then riffle through pages of statements to find the cost basis for that particular stock.

Although I felt pretty confident in my recommendation to shred investment paperwork, I did a great deal of research last week and learned there is a much more efficient way of retrieving cost basis information that is maintenance free, and self-purging. The FreedomFiler way!

Here’s what we recommend for retaining (and finding FAST) investment information.

1. Request Gain/Loss realized and unrealized reports from your brokerage house, also request these be sent annually with the 1099. File these in an orange (Remove/Replace) file labeled “Gain/Loss Report”. Once the new statement comes in, remove the old report and replace with the new. The new statement has all the gain/loss information for the entire history of the account, so there is no need to retain the old one, thereby keeping paper to a minimum, and letting you find the info you need – fast!
2. Retain purchase and trade confirmations “permanently” (until sold). Create a red (permanent) file labeled “Investments Owned” . If needed, you could create a file folder for each investment account for each family member. Alternately, if you had lots and lots of securities, you could file them alphabetically.
3. When you want to sell a security, you can easily find the purchase confirmation and determine the cost basis or average as needed.
4. When the security is sold, the purchase agreement is removed from the permanent folder and filed in that year’s tax documents (blue files) along with the trade agreement. These statements will then automatically be retained for 10 years.
5. File monthly statements in the green rotational files for even and odd years. You will have these statements for two years to refer to and verify trades. After two years, monthly statements will be shredded.
6. We also recommend using a software or simple spreadsheet for tracking trades as a back up and for easier calculation.

Please note that the owner of the investment is responsible for retaining records of the purchase and sale of securities. If they are audited, the IRS is going to need proof of how the cost basis was calculated, so the holder or trustee is responsible for keeping a record of the purchase. This becomes even more important if you changed brokers, as in the past, firms did not necessarily forward cost basis information.

Thank goodness for FreedomFiler!