Having fun yet pilling through your record as you get your federal income tax return done and submitted on time? Well, we finally were on time this year. Bet our CPA was very surprised after having to request extensions for the past several years!
Now that you hopefully have your tax-related records all in order and FIT is done, how’s your budget looking? I hope you were able to start a real-life budget or revisit and refine your existing one. Let’s move on to another recordkeeping routine that few seem to see as an important part of one’s net worth . . . keeping a record of your home and other possessions.
One of the more important aspects of this form of recordkeeping has to do with warranties, operation manuals. What do you do with the warranty card and operation manual you get with your new refrigerator, lawnmower, car, bicycle, saw, sewing machine, computer, ipad?
Did you throw those purchase documents away? Throw them in a box and promptly forgot where you put that box? If so, you are not alone. How about getting a little more organized this time around when it comes to home and possessions? Were you able to rummage through your closets to hopefully find that box!?
Let’s start with a Home Inventory Sheet that can identify those possessions you own. It will give a detailed list of your physical assets, their purchase date/value and replacement value. A home inventory is helpful in assessing your total assets and liabilities as well as determining how much insurance coverage you may need.
This inventory will assist you in making claims on any losses that may occur. Go through each room (Categories: Bathrooms, Bedrooms, Closets, Dining Room, Garage, Kitchen, Living Room, Dining, others) and include everything you own (including anything on walls, in closets, in garage, any jewelry). Take pictures of your possessions to place in your safe deposit box along with your inventory sheet.
When you mark the cost of each purchase, estimate the value (exact amount/year purchased if possible). If receipts are unavailable, research internet for current value. The current market value is today’s replacement cost. This market value needs to be kept up-to-date.
ITEM Purchase Date Cost Current Market Value (year)
By all means, if you prefer, utilize a money management software program that has a home inventory feature. It will make it easier to keep track of your possessions and their value at the point of purchase. In addition, begin to put all those warranty and operation manuals in a single location. A 3-ring binder may prove helpful to keep in your office or bookshelf. It will then be handle when you need to refer to it when you can’t figure out how to set up or enhance that entertainment center you love so much! Also, your warranty/repair parts contact information will be easily accessible if your saw or sewing machine breaks down.
Before we move on to the next recordkeeping part of this lifeskill, what reasons do you give yourself for not setting this recordkeeping routine for your possessions? What reasons do you see as valuable to living a more organized and dollar-savings life overall? And those dollar-savings could very well be become part of benevolence and giving, which happens to be the next topic for this lifeskill.
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