The Best Ways to Secure Important Financial Documents

important financial documents

The Best Ways to Secure Important Financial Documents

When it comes to storing important financial documents, a shoebox under your bed doesn’t cut it. Estate planning documents — such as wills, trusts, living wills, medical directives, and powers of attorney —are essential to you. So where do you keep them safely secured? And what about your digital assets, passwords, and social media accounts?

Some states have public will registries; there are private registry companies as well. However, registering financial documents may not be enough. Ensuring your family knows about your estate and other materials and where to find them is vital. Life insurance policies, divorce records, and real estate deeds are some of the other physical documents that should be kept safely in a safety deposit box, a safe place at home, or backed up digitally.

It is recommended to have multiple copies of information to protect yourself against loss. What would you do if the hard drive on your computer suddenly cratered?

Here are some action steps to take:

  • Invest in a multifunction scanner. Use it consistently when you get a new important document (passport, life insurance policy, etc.)
  • Back up digital documents. Emailing copies of your documents puts you at risk if your laptop or phone are stolen or hacked. We recommend backing up digital docs on an external hard drive or a secured cloud-based backup. Periodically, you should make a copy of that storage and put it somewhere offsite like a safety deposit box.
  • Make copies. If you travel a lot, you could also make another copy and take it with you. Make sure it’s encrypted in case you lose it. The most important thing is to choose a strong password that you will be able to remember.
  • Create a cloud storage account. If carrying a physical hard drive or SD card doesn’t appeal to you, make yourself a cloud storage account with Google, Apple, Dropbox, Box, etc. For small amounts of data, these are usually free. We recommend having a special one just for backing up your documents.
  • Secure the data on your mobile devices. Just as you wouldn’t leave your passport or other relevant documents lying around in public, you need to be careful about your computer, tablet, and smartphone. Keeping sensitive data on external storage or in the cloud is a safer option.

Designate someone to look after your social media. Emails, websites, online services, and social media accounts may be essential to access someday if you pass away or are disabled. Different companies have different policies. Facebook, for example, allows you to name a “legacy contact.” This is someone who can look after your account after it’s memorialized.

There’s also the problem of where to keep your passwords. To that point, we recommend buying a unique password keeper, but they are a security risk. Many people are moving toward password manager programs that generate and maintain strong passwords. Again, be sure you won’t lose your master password.

Need help backing up your financial documents? Click to find out how we can help.