How Long Do I Need To Keep Bank Statements (And Why)?

Exact Answer: 1 Year

Bank and credit card statements arrive regularly, either by mail or electronically. Examining them is a vital part of keeping your finances in order. But most people are not sure about the amount of time for which they should retain those bank statements to keep them safe and that is what we will tell you today. 

The length of time you should keep bank and credit card statements is determined by several factors. In most circumstances, you should keep them at least until you’ve paid your taxes for the year and settled any outstanding fraud issues, but keeping them for longer may pay off in the long run.

How Long Do I Need To Keep Bank Statements

How Long Do I Need To Keep Bank Statements?

TimeDuration
Minimum1 Year
Maximum2-3 Years

When doing your taxes, having all of your statements on hand will aid you in confirming income and precisely tracking deductible spending. Yes, this is true no matter whether you get your statements in the mail or by email, you must keep them safe for at least one year. If you go for paperless statements, they are easy to view online. 

You can also download and save your statements in a password-protected file, or you can print them. You’ll be able to access them in either case for as long as you like. Save any statements you utilised to assist you to calculate your taxes for at least seven years, along with your tax return, in case the IRS has any issues.

 Tips on how to keep financial papers safe and secure can be found in Experian’s advice to keeping them. It is possible to view previous statements without making copies, although you may like to do so anyway. Your financial institution may be able to supply you with copies of previous statements on request if they keep information in their system for several years. 

By contacting your bank or credit card issuer, you can also get prior copies of the statements you regularly receive by mail, for a cost. The amount of time your financial institution will keep these documents and make them available to you varies, so it’s a good idea to look into it. When you keep your bank statements for 1 year, you don’t have to worry much when their needs arise.

Why Do I Need To Keep Bank Statements For That Long?

Some credit card providers only provide online statements for the last 12 months; you may have to do additional legwork or pay for missing statements, as well as wait a few days or weeks to receive anything beyond that. On checking, home mortgage, and deposits etc., some banks keep account statements for up to seven years. But, five years is the standard at other financial organisations.

If you’ve relied on your financial statements to back up information on your tax returns, you may wish to preserve your paper or digital versions instead of relying on the bank. You can be sure you’ll have these records for the full seven years if you do it this way. You’ll be able to access and refer to this information at any moment without having to look it up online.

Once you know that you don’t require your documents anymore, you can shred the paper copies and delete the electronic ones. Free software for Windows and Mac computers can assist ensure that these files can’t be recovered later by nefarious individuals. When it comes to paying your taxes, bank, credit card, and investment account statements give a plethora of information.

You should review your statements weekly throughout the year, in addition to once a year at tax time. Although you can monitor your transactions online or through a mobile app regularly, your monthly statement provides a complete accounting of your activities and may reveal transactions you missed previously. You can check if your expected deposits have been credited and if any unusual or inaccurate transactions could indicate fraud.

Conclusion

Your bank and credit card statements give you clear and detailed information about what’s going on with your accounts. It can also serve as important supporting proof if your finances are ever questioned. This is why we are saying that it is important for you to keep them safe with you for one year. Once you are sure that you won’t need them anymore, you can get rid of them.

Examining statements can aid in the detection of fraud and other abnormalities, such as an unexpectedly high bill. Keep them for as long as you need them to assist with tax planning or fraud/dispute resolution. Also, if you’ve utilised your statements to back up information on your tax return, keep your files for at least seven years.

References

  1. https://search.proquest.com/openview/d8abc5ad033333244791f1e576684d44/1?pq-origsite=gscholar&cbl=3330
  2. https://heinonline.org/hol-cgi-bin/get_pdf.cgi?handle=hein.journals/yjor26&section=13
  3. https://vtechworks.lib.vt.edu/bitstream/handle/10919/75629/VCE354_013.pdf?sequence=1
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