Comments on: 5 Ways to Reduce Financial Clutter

By: chewy

chewy — Mon, 22 Mar 2010 20:28:24 +0000

Another point, since I am getting a lot of my tax documents now in PDF, why keep any paper copies of anything for Personal Income Tax? If you have everything in Electronic format, and have some sort of backup solution, is there any requirement that you have a paper copy of something? I could see some potential issues with Businesses and why they might want to keep paper copies, but for personal taxes that are fairly basic?

By: chewy

chewy — Mon, 22 Mar 2010 20:26:46 +0000

I too have been trying to go paperless. I find the majority of utilities and Banks offer PDF statements (RBC has every statement available to me in pdf format since they started offering paperless statements – 2006 I think).

A couple of Banks (BMO and TD that I have found) don’t offer statements in PDF format, which really bothers me. They have told me I can download the statement with my financial software. I do download it, but I also want a bank statement in PDF format as that is only record that is official. It is also a record that cannot easily be changed. Until they offer the statements in PDF format, I will not go with their Paperless statement option. When I get their statements in the mail, I scan them to PDF and then shred them.

By: Senk

Senk — Tue, 02 Mar 2010 15:48:55 +0000

I would hang on to your credit card statements. You’ll need them if you ever need to make an extended warranty claim through your credit card.

By: Matt @ Dividend Monk

Matt @ Dividend Monk — Sun, 28 Feb 2010 04:09:55 +0000

Good post. I especially agree with the point about limiting banks. If you have investing accounts with brokerages, it can also get a little out of hand because you might have various accounts there too.

By: Anjo

Anjo — Fri, 26 Feb 2010 15:48:15 +0000

Stephen: I haven’t bothered encrypting the data. My folders are protected by user id and password, although I assume a hacker could break through those locks. I keep my virus and spyware software up to date and scan regularly. I suppose someone could access the information on my computer, but I think the chances of that happening are very miniscule.

Based on recent occurences, I am more concerned with the security of my information as held by the credit card, utility or other company. Not much I can do about that though.

By: Stephen

Stephen — Fri, 26 Feb 2010 15:10:54 +0000

I’ve been planning to go 100% electronic this year if possible. However I’m wondering if any of you are encrypting your bills and data on your computers. Maybe I’m just paranoid, but if I virus gets in there and starts transferring your files out over the internet or if somebody gets a hold of your computer or laptop then that’s a lot of financial and personal information about you all in one place.

Anybody else concerned about this or am I just paranoid?

By: bg

bg — Fri, 26 Feb 2010 14:39:50 +0000

I had automated the payments of my bills using my checking account, but the Canadian Tire MasterCard allows me to pay my bills expecting from me carry balance at the end of the month and make interest of that, at the same time you save 1% in return.
I decided the following
1-stop the automated payments
2-Pay as much as I can with my credit card
3-pay on time and full my credit card.
Also another detail, my checking account allows me certain quantity of transactions per month, with this method I reduced the amount of necessary transactions transforming them in just one, the payment of my credit card.

By: mp

mp — Fri, 26 Feb 2010 02:52:30 +0000

All my banking is automated. I never set foot in a bank. I have a great financial software that keeps track of bank accounts and investments. I pay all bills on line but I keep all my bills for 1 year with the tracking number of the bill payment.

I never knew it was 6 years to keep tax returns. I keep 10 years just in case. 4 more years doesn’t take up much more room in the filing cabinet.

By: Ken Siew

Ken Siew — Fri, 26 Feb 2010 02:24:42 +0000

Totally agree with automation. People are lazy to think about paying the bills and forgetful all the time. It’s saved me a lot of headache and mind power that I could put into use elsewhere – like building a biz and earning more money.

By: The Reverend

The Reverend — Fri, 26 Feb 2010 01:57:15 +0000

has anyone done detailed math on equal payment billing? i can’t help but thing the company somehow upfronts the billing to protect themselves and the users end up losing out slightly.

By: Steve

Steve — Thu, 25 Feb 2010 21:12:35 +0000

A problem with automatic withdrawals is if a business makes an error, they could withdraw more cash out then they should be. By paying them yourself, if they make an error, you call them up and have them correct the bill, then you pay the correct amount.

Its a good idea to be up to date with the bills, if it’s automated, it might be forgotten just how much you are paying!

If a bill accidentally withdraws too much, you will not get an immediate cash refund, you’ll get a future credit, which could leave you cash strapped or even accidentally in overdraft. I’ve seen the latter happen to people who live paycheque to paycheque.

By: Kathryn

Kathryn — Thu, 25 Feb 2010 19:50:35 +0000

Mike4p: I just called up each of the companies and asked how I sign up for automatic billing. Regarding hydro, water and gas, we arranged to go on equalized billing so not only does the bill come out automatically every month, the same amount comes out every month.

I tried e-bills too but also found it wasn’t very useful for my needs. Happy to hear it works for others though.

Andrew: You need to keep receipts that you claim for tax purposes for up to 6 years. I’m referring more to non claimable grocery or entertainment receipts that aren’t needed anymore.

Uber: Perhaps your wife and I should meet. She sounds like my type of person. :-)

By: Bilbo Bloggins

Bilbo Bloggins — Thu, 25 Feb 2010 19:05:59 +0000

Sorry to burst your bubble, but while credit card statements can be accessed online, they often only keep 6 months to 1 years worth. If you want to retrieve the older stuff, they will make you pay.
Same goes for online banking.
Did you really think the financial institutions would give you everything for free?

By: YYC81

YYC81 — Thu, 25 Feb 2010 19:03:17 +0000

@Brendan
The legal requirement is to keep records for at least 6 years. There are a few things that have to be kept forever (mostly relating to incorporation). The CRA can specifically ask you to keep certain records for a longer period of time. You can ask the CRA for permission to destroy records early.

The CRA can review and reassess a return up to 3 years (I think) after the initial assessment. In cases of fraud or misrepresentation, they can go back as far as they want .. though how thorough an audit they could do a decade after the fact is questionable.

By: Brendan

Brendan — Thu, 25 Feb 2010 18:31:41 +0000

Is the 6 year rule a for sure thing with CRA?
I recently read that CRA was going after one of the Rizzuto’s in Montreal for tax evasion dating back well over a decade ago.

(I have nothing against mafia.. not that I am saying mr rizzuto is or isnt a mafia guy, nor am I planning on evading taxes).

But if I were to do a smith manouevre, I would hate to have them go back past 6 years.

I have heard that CRA can go back as long as they like if they really want to. Is this true?

By: FrugalTrader

FrugalTrader — Thu, 25 Feb 2010 18:05:14 +0000

Mike, do they take credit card as payment? Most places that take CC as payment will also accept pre authorized payment.

By: Michelle

Michelle — Thu, 25 Feb 2010 17:48:16 +0000

Bob, I tried epost, but found out it wasn’t very useful for me. Only 2 of the bills I pay were in their system as providers. It ended up being another site to log on to. I think the idea is great, but it needs some work.

By: Mike 4P

Mike 4P — Thu, 25 Feb 2010 17:46:09 +0000

Probably a stupid question, but can you automate irregular bills?

Ie Ontario Hydro, Enbridge Gas, Bell telephone (to name 3 that I pay manually every month or so).

By: bob

bob — Thu, 25 Feb 2010 17:22:10 +0000

epost, by Canada Post, is actually a pretty nice system.

By: FirstGenerationWealth

FirstGenerationWealth — Thu, 25 Feb 2010 17:02:31 +0000

One trick I have done and suggest to clients is to scan a copy of your tax doc’s to .PDF format and keep in a folder on your computer. Store the hard copy away, but when dealing with your bank its easier for you (And the lender, take my word for it) when you can forward an email with 3 years doc’s T1’s/NOA’s (Especially for business for self tax filings).

Its a much greater ‘quick reference’ to tax info than digging through boxes in storage.

Just my $.02