You probably have noticed by now, your loyal bank is now charging a monthly fee to mail you your bank statement. Cancelled checks? The banks stopped sending those years ago.
If you are like most people, you have chosen the option to have your banking information online, rather than pay to have it mailed. While it definitely saves trees, and postage, what it doesn’t do, is give you the accessibility to your statements after a period of time.
Banks vary on the amount of time they will “hold” your statements online. The time ranges from twelve months to two years. After that, the information disappears and if you need a copy there is usually a fee!
Most of the time, any problem with a check, debit or credit will show up in a month or so, and all the information will be available to you to resolve the dispute.
The problem can arise if you are ever audited by the IRS, the State government, Social Security or any other government division, either for you or your business. The IRS has up to three years to challenge your tax return. When they do, they may ask for all bank statements and certain cancelled checks. By then, they have Disappeared! And your bank will charge you dearly for copies.
There is an easy solution:
Make it a habit that as soon as the bank statement is “posted”, either print a copy or at the very least save a copy as a “PDF file” to your hard drive. Also peruse the checks that cleared that month, and if any are pertinent to income taxes either print a copy, or if possible, also save as a “PDF”. If you are a business and you do not receive your checks back as “images” you should consider printing or saving all cleared checks!
Because hard drives fail, and computers get upgraded, data can get lost! Consider backing up your saved “PDF” files to an external “USB” drive for safekeeping.
Another reason to save bank statements is, sadly to say, due to our nation’s divorce rate. Almost one-half of marriages end up in divorce! If the family has accumulated assets, and/or alimony and child support are an issue, then bank statements and cancelled checks may be required to prove the “Standard of Living” for the family.
In Summary, the banks will only continue to seek fees for services they used to provide for free. Don’t fall into their trap! Be proactive and you could save yourself a lot of money and time in the future!