We are all bombarded with so much paper that it can be hard to wade through it all at times. Between the junk mail, receipts, and financial documents we collect, it may seem a little ridiculous to keep paperwork we feel we may never really need. And considering the move to online banking, isn't it time to give up that old shoebox system of record keeping?

While you may not need that old filing system, there may actually come a time when you'll need your old bank statements. These statements represent the activity that takes place within your bank account—a checking, savings, or other type of account held at your financial institution(s). Read on to find out more about how long you'll need to keep your statements, and why.

Key Takeaways

  • Bank statements should be kept in hard copy or electronic form for one year, after which they can be shredded.
  • Keeping bank statements is ideal to verify debit and credit activity, to protect against identity theft, and to prove income.
  • Banks allow customers to access bank statements for at least a year online.

How Long Should You Keep Your Statements?

If you haven't opted out of traditional paper record keeping with your bank, this means you'll continue to receive paper statements in the mail. Plan to keep these bank statements for a minimum of one year. You can choose to keep and file a hard copy of your statements. But make sure you keep them in a place that's easily accessible for you, but away from prying eyes. Alternatively, if you're great at data entry, you can choose to keep an electronic format in a bookkeeping program or your own spreadsheet. After this one-year period, it's safe to shred and discard them.

Reasons for Keeping Statements

Outside of having records for purchases, bill payments, and payroll deposits, keeping old bank statements offers a number of benefits. Bank account activity should be reviewed regularly for instances of identity theft and debit card fraud. Keeping statements provides verification of illicit activity that can be used to recover any damages.

You can also use bank statements to verify income and transaction activity, such as charitable contributions and business expenses that you may need for tax returns. Bank account statements confirming large purchases or payments may also be worth keeping. You can shred automated teller machine (ATM) receipts once you reconcile them with your account records. Similarly, deposit and withdrawal slips can be shredded once transactions are verified with the monthly statement.

Online vs. Hard Copy Statements

Maintaining hard copies of bank statements is less of a necessity than in the past given the availability of account information online. Many banks and financial institutions maintain monthly customer statements online for five years or longer that are accessible through their online banking platforms. Detailed statements often come in easily printable formats, and summarized transaction information is frequently available for download free of charge.

You may also be able to get hard copy statements from your bank going back a number of years. Some banks charge a search and/or printing fee for this service, as it cannot be done at the branch level. Instead, older statements are printed and prepared in a back office.

For safety, it's best to keep any hard copy bank statements in a fireproof safe in a secure location. Electronic statements should be maintained in a password-protected file.

Hard copy statements should be kept in a secure, fireproof location that can be easily accessed.

Shredding Documents

Because so many different documents have different requirements for disposal, it may seem easier to just keep everything forever—including bank statements. However, keeping some documents indefinitely isn't the best practice, primarily because of the potential for identity thieves to get a hold of them.

Other documents you should shred after a certain period of time include the following:

  • Credit Card Statements: Keep them for 60 days unless they include tax-related expenses. In these cases, keep them for seven years.
  • Pay Stubs: Match them to your W-2 and then shred them.
  • Utility Bills: Hold on to them for a maximum of one year.
  • Tax Returns and Tax Receipts: Just like tax-related credit card statements, keep these on file for seven years.
  • House and Car Insurance Policies: Shred the old ones when you receive new policies.
  • Mortgage Statements and Home Improvement: Shred these when you sell the house.

How to Shred Your Documents

When you're ready to dispose of your bank statements, make sure you actually shred them. Just ripping them in half, isn't going to stop identity thieves from piecing together your personal information. If you have a shredder, you can take care of this yourself. If not, you may have to hire a service, especially if you have a large number of documents. Also, check with your bank. Many will offer shredding services to customers without a charge.