Why You Need an Effective Filing System and Tips for Creating One

fileIf you’re serious about running a successful business, you have to give some thought to your filing system. Filing may seem a bit secondary to actually running and growing your business, but like many behind-the-scenes business administration tasks, a poor filing system can hurt your productivity and profitability.

Why Focus on Filing

There are many reasons why an effective filing system is vital for a successful business. Here are some of the biggest:

  • You need quick and easy access to your financial records for tax purposes and a solid paper trail if you ever face an audit.
  • You should have an idea of where your finances are at all times – including open contracts, unpaid invoices and bills due.
  • Conscious filing will make it easier to get rid of the information you really don’t need to keep.
  • Your clients expect that you will securely keep all information they send you on their company and projects.
  • The more systemized and consistent you are with your filing, the easier it will be to quickly find specific information when you need it.

Tips for Creating an Effective Filing System

Filing can be daunting, especially if you haven’t paid much attention to it and now have a mess to sort through and organize. But creating an effective filing system isn’t an overly complex feat. In fact, it boils down to two simple things – setting up a file system that makes sense to you and consistently keeping it up.

Here are some tips to get you off to a good start with your filing system:

  • Consider how you tend to sort information in your head, and sketch out a paper-based system that mirrors it.
  • Name files in a way that makes immediate sense to you and consider color coding your files for easier recognition.
  • Start simple and let your file system grow organically.
  • Keep files, labels and other materials on hand to make it easier and quicker to file items away.
  • Create a central “To File” location to collect paper that you need to file so you can quickly do a chunk of filing at one time.
  • Schedule time each week to catch up on filing and clear your desk and computer desktop.
  • Invest in a good shredder for any papers you determine do not need to be kept.
  • Don’t forget about electronic filing – create a secondary system (or primary, if you run a paperless business) for organizing files on your computer. And back it up!
  • Revisit the setup of your system regularly to ensure it meets the needs of your business, and be willing to adjust it as necessary.
  • Plan a file purge every six months to a year to clean out dated, irrelevant or unnecessary files.

How do you stay on top of filing? What type of system do you use?

Image credit: yum

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  • Scoop0901

    I use Microsoft OneNote — a great tool that I’ve used for several years now. I can print any paper form to it in seconds, import images, grab text from images, and write and save all notes and information to it.

    Using OneNote is supposed to be like using a notebook, but I think of it more as a filing cabinet.

  • Simon

    Personally, having been involved in all the GTD stuff; which is extremely good by the way; on a computer I think tags is the way to go. Every file of mine is tagged. I use Leap (Mac OS only) and it finds anything combination of tags. I can tag emails, images, documents, etc. You just need to make sure you know your tags!