Save or shred? A guide to sorting important financial documents.

Stuffing filing cabinets with miscellaneous documents is easy, but it’s not so easy to sort out what’s really worth keeping and what should be shredded.

Credit card statements, ATM receipts, bills and even airline tickets should immediately be shredded; so should expired credit cards, visas, passports and IDs.

The documents you save should be kept for different periods of time. Here’s a breakdown of how long you should hang onto important paperwork.

Keep forever

Certain documents issued by the state or federal government, such as records that establish your identity or prove ownership of property, can be difficult to replace. This includes items like birth and death certificates, licenses or deeds. Physical copies of  these documents can prove who you are in the event that your identity is stolen.

If you’ve created estate-planning documents such as wills and trusts, your attorney will have copies, but it’s best that you also have a set. Keep the most up-to-date, fully executed copies with all amendments. You should also make sure that someone close to you knows where the documents are so your family isn’t left scrambling when you are no longer around.

Keep for a while

You’ll want to keep records of the following documents for a certain period of time before shredding. It’s not always necessary to retain hard copies of these items; scanning and storing them electronically may suffice.

Tax records and receipts should be kept for seven years. This includes federal, state, and local returns. With your returns, also keep supporting documentation like W2s, 1099s, charitable contributions, mortgage interest payments and retirement plan contributions.

Keeping these documents in an organized manner can alleviate stress if you are audited. The IRS is permitted to audit you within three years of a suspected good-faith error, within six years if it believes you underreported income by at least 25%, and for an unlimited time if you did not file a return or filed a fraudulent return.

You should keep your pay stubs for one year to ensure they match your W2. If the details match, you can shred the stubs. If not, contact your employer for a revised W2.

Bank and brokerage statements should be kept for seven years if tax-related expenses, like charitable contributions or real estate taxes, are documented. Keep the statements with no tax significance for one year.

Medical records and bills should be kept for one year after payment in case there are any disputes.

You should keep all records documenting the purchase of your home. You should also keep documentation of any improvements or other expenses incurred to sell your home, which are added to your purchase price, lowering your capital gain when you sell your home. Six years after you sell your home, you no longer need these documents.

Keep warranties and receipts for as long as you own the items.

Keep the most recent version

You should keep your most recent annual insurance policy statements for any active insurance — such as auto, homeowners and life — and annuity contracts. With your insurance policy, you should also maintain records of larger purchases like jewelry, antiques and furniture to prove their value in the event of loss or damage.

Before you discard your retirement plan statements, make sure any after-tax or Roth contributions are appropriately reported.

Store documents safely

Remember that physical records should be kept in a locked filing cabinet or safe deposit box. For digital copies, don’t store records in emails or online storage sites, other than those with 256-bit Secure Socket Layer (SSL) encryption technology to prevent access to your data by unauthorized users. This is the one of the highest levels of encryption available today.

Once you’ve organized your documents, make sure someone knows where your important documents are stored and can access them in the event of your death or incapacitation. Having all of your documents organized and safely stored will alleviate stress during difficult times.

The bottom line

Don’t keep records any longer than you have to. A good rule of thumb in deciding what to keep is to think about how hard that document is to replace. If it would take venturing to a government office or a hospital or sitting on hold for an hour to get a new one, then you probably want to hang on to it.

Learn more about Jeremy on NerdWallet’s Ask an Advisor.

This article first appeared in NerdWallet.