Personal Finance

6 Reasons to Go Paperless & How to Do It

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6 Reasons to Go Paperless, and How to Do ItLast fall I opened one of my filing drawers to retrieve a health care receipt for my husband. He took one look at the file bulging with receipts for our Flexible Spending Account and, shaking his head, said, “I don’t remember my mom having filing cabinets full of stuff like this.” Whether it’s just our imagination (or our age?) it does feel like our files are starting to get out of control and it’s time to do something about it.

So I’ve set a goal to go paperless in 2013. I’ve identified six benefits:

  1. Save money. A credit union I belong to charges $3 for a paper statement. Online statements cost nothing. That’s a savings of $36 a year for just one account. Additionally, when I pay bills online I save money on postage. And it’s not just bills you can save money on. I have a Kindle so I can save money on ebooks versus printed versions.
  2. Help save the planet.  My teenage daughter is very good at reminding me that I am contributing to the destruction of our forests when I waste paper.  Looking at the boxes of paperwork stored in my home office, I cringe when I think of all the trees that have been sacrificed. With the technology that will be available when she goes out on her own, I don’t picture her ever having to deal with boxes of paperwork like I do, fortunately.
  3. Save time. As a working mom, time is just as important to me as money. By reducing piles of paperwork that need to be filed and sorted, I expect to save some seriously valuable time.
  4. Save space. My closet in my home office is full, and on top of it I have three full file cabinets. There are also several boxes of stuff sitting in my office that I need to find room for. If I don’t so something now, I can see where this is headed — and it’s not pretty.
  5. Safety. As long as I keep my virus protection up to date (which I do, thanks to learning the hard way), keeping my personal information on my computer is likely safer than receiving statements and sending payments by snail mail. Plus I am not leaving my personal information in file folders where anyone who came into the house could take them.
  6. Feel better. Clutter is exhausting. Every time papers pile up on my desk I start feeling overwhelmed and crabby. Clearing it out just feels good.

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Free Credit Check & MonitoringHow to Go Paperless

I’ve wanted to go paperless since reading Mark Frauenfelder’s stories on the Credit.com blog two years ago. He shared how a leak in his garage forced him to find a better way to store important information.  I also recently interviewed Scott Bilker from DebtSmart.com on my radio show about going paperless, and he convinced me this is something I need to do. But my half-heartened attempts in the past didn’t work. And part of that was due to the fact that I didn’t have the right tools. So step #1 for me (and likely for you, too), is simple:

Get a good scanner. My printer has a built-in scanner, but it is slow and clunky. Recently, the folks at Doxie heard my radio interview with Scott Bilker where he shared how he went paperless, and sent me one of their scanners to try. It’s tiny and much faster. I had it set up and was scanning within 20 minutes of opening it.

I feed the document though the scanner and the image is saved on an SD memory card. (That means it doesn’t have to be hooked up to your computer while you are scanning.) Once I’ve scanned all the paperwork for that session, I pop the SD card out of the Doxie, put it in my computer and open the Doxie program. From there I can “staple” items to together if I want to keep them grouped together, then save them to my hard drive as virtually any type of file, or upload them to Google Docs, Evernote, Dropbox or other cloud services. So far I have tried uploading them to both Google Docs and Evernote, and both were very easy to use.

I used my Doxie to scan both full-page documents as well as an assortment of small receipts from a recent business trip. It could not have been easier.  And it’s inexpensive:  $149 or $229, depending on which features you want. I have the less expensive model and am perfectly happy with it. (A student and teacher discount brings the price down to $119.)

If you need a scanner that will allow you to feed multiple pages at once, you may want to check out reviews of other scanners, like the Fujitsu ScanSnap.

[Related Article: Why Shredding Your Documents May Not Be Enough]

Get a good shredder. Once you have scanned your documents, you’ll want to put them straight into the shredder. Pick a cross-cut shredder for maximum safety and security.

Sign up for e-statements.  Get your bills or statements online.  That way you won’t have to scan them; you can just download the ones you want to save to your computer. A warning: Do not use this as an excuse not to read your statements. It’s easy to fall into the trap of just paying the amount due, but it’s also important to review your accounts for any unauthorized charges or changes in terms.  And don’t forget to opt out of unsolicited credit card offers and direct mail if you don’t want to receive them.

Back up. If you are using your computer to save your documents, it’s essential that you have a back-up system in place. I used to use an external hard drive but I wouldn’t always run back-ups like I was supposed to, and I worried that if my office was robbed or destroyed, my external hard drive would likely be gone as well. So now I just use Carbonite, which automatically backs up my files to their cloud-based service daily. When my computer died last year, my Carbonite files saved me from losing a ton of important work.

Have you gone paperless? I’d love to hear how it worked for you! Feel free to share your experience in the comments below.

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Image: Lawrence Murray, via Flickr

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