Wherever the documents are stored, it is important to keep them organized and up-to-date. The goal of electronic file management is to ensure that you can find what you’re looking for, even if you’re looking for it years after its creation.
We often find clients scrambling around at year-end trying to find documents pertaining to their personal or corporate taxes. Fortunately, there are tools available that you can use to get organized. There’s no perfect way when it comes to electronic file management, but the following tips will help you create order from chaos.
How to Organize Your Documents
- Map out the folder hierarchy. Think of this as a floor-to-ceiling stack of (neatly organized) filing cabinets in your office. This is the most critical step in your organization process so take your time to think about how you want to structure them. You can look at the image below for some ideas.
- Choose your storage. Once you have folder-structure ready, you can keep it where it already is on your computer or you can move it to a cloud-synced folder such as Microsoft One Drive, Sync.com, Google Drive, Dropbox, etc. Here is a brief introduction to all of them:
- Google Drive: Offers 15 GB of free storage (data is encrypted in transit and at rest), and a mobile app to manage documents through mobile. Data is stored in the United States.
- Microsoft One Drive: Offers 5 GB of free storage (data is encrypted in transit and at rest), and a mobile app to manage documents through mobile. If you share a Microsoft 365 subscription then you automatically get 1 TB of free storage. Data is stored in the United States.
- Sync.com: Offers 5 GB of free storage, end-to-end encryption, and a mobile app to manage and share documents through mobile. Data is stored locally in Canada. So if you or your business deals with confidential information that must be encrypted and stored in Canada then this is the best alternative.
- Dropbox: Offers 2 GB of free storage (data is encrypted in transit and at rest), and a mobile app to manage documents through mobile. Data is stored in the United States.
- Move your existing data. Once you have created the desired folders, you can start moving your existing data into newly-created folders. Data will start syncing as soon as it is moved. Let the syncing finish before starting to make any changes.
- Follow the correct naming conventions, so it can easily be searched. For example, if you buy a keyboard from Staples in December of 2020, you may want to name it “12-Dec – Staples – Keyboard“. Not only will it be alphabetically organized, but it will also be easily searchable in case you need to search for the receipt.
- Back up your files regularly. Whether you have the files saved on your computers or in a cloud-storage, make sure you have a secondary backup solution.
How to Stay Organized
After your data is synced and you have a backup plan in place, use the mobile apps of your cloud storage provider to upload documents directly to the cloud. For example, you go to Staples on January 4, 2021, and buy supplies, you can take a picture of the receipt and upload it to the relevant folder (Office Supplies > 2021) and it will automatically show up on your computer.
Things to Keep in Mind
- The key to your online security is to have strong passwords. Strong passwords consist of a combination of uppercase and lowercase letters, numbers and special symbols, such as punctuation.
- Ensure that you have 2-factor authentication turned on for your email as well as the cloud storage providers.
- Data that you will not access on a regular basis should be moved to the vault (a folder that can only be accessed via the cloud storage provider’s website) that has another layer of protection.
- For those who are legally required to keep the customer data in Canada, only Sync.com offers the option by default.
- Make sure that the cloud storage provider’s mobile apps are locked with a password or PIN.
- Anti-theft your device. If your gadget is lost or stolen, tracking apps can help you find it.