(MONEY Magazine) – Warren and Rosemary Wells of Deerfield, Ill. once belonged to the accumulate- and-procrastinate school of record keeping. They saved everything. In their basement and study they had five file cabinets stuffed with important papers such as stock certificates, IRA statements and the deed to their house -- as well as more than 20 years' worth of canceled bankbooks, credit-card and utility bills and other useless documents. Finally, with the help of certified financial planner Victoria Ross, the couple cleared out the useless documents and organized the records they really did need into one two-drawer file cabinet. ''We found things we had totally forgotten about,'' says Rosemary Wells. ''We thought stock we had inherited years earlier might be worth $5,000 or $6,000, but we turned up certificates actually worth more than $20,000.'' You can't expect that kind of reward from cleaning the clutter out of your life, but it's still worth doing -- for its own sake, as well as for the possibility of saving some money. ''We have people coming in with boot boxes full of papers and receipts,'' says Brad Greer, a certified financial planner at First National Bank in Albuquerque. ''If your accountant or financial planner charges by the hour, organizing and weeding your records before you turn them over could reduce your bill by about 10% to 20%.'' You can start by throwing out worthless documents. Follow this rule of thumb: if you don't need the record for tax purposes or if you are sure it can easily be replaced, don't save it. The table lists some items that everyone can routinely toss in the wastebasket.

For example, keep your monthly credit-card statement only until your bank returns the canceled check verifying that you paid the bill. Then get rid of both the statement and the check. In fact, you can throw out all canceled checks except the ones you need as tax records. Monthly mutual fund and brokerage statements can be discarded once you receive your comprehensive year-end accounting, which lists all of your transactions for the 12 months. Two exceptions: save every trade confirmation and dividend-reinvestment statement. ''Every month I see people who have no idea of the cost basis of an investment, because they don't keep track of reinvestments,'' says Gary Greenbaum, a certified financial planner in West Orange, N.J. ''They end up overpaying taxes when they sell the security.'' Receipts for minor daily purchases such as groceries can routinely be tossed but not receipts for expensive purchases such as jewelry and furniture. You will need them to settle insurance claims in case of loss, theft or damage. In weeding out records, use common sense. For instance, if you are having trouble with your broker and anticipate having to go to arbitration, you should turn into a pack rat. Save all account statements and even keep summaries of phone conversations with the broker. Also, when in doubt about your disposal habits -- for example, if you are self-employed -- check with your accountant. Most of the records can be kept at home. A shoebox may be sufficient for some people, but you are probably better off paying about $50 for a sturdy, fireproof file box, which can typically hold at least six years' worth of documents. Hard-to-replace records such as stock certificates, a divorce decree or a power of attorney should be stored in a safe-deposit box. Banks charge about $25 to $50 a year for a three-inch-by-five-inch-by-24-inch box, sufficient for most families. The records you must safeguard at home or at your bank can be divided into the following two groups, depending on how long you must keep them (see the box on page 157 for suggestions): -- For six or more years. If the IRS hasn't begun an audit of your tax return six years after you file it, you can reward yourself by tossing out copies of the return and of the records that prove your income, deductions and other entries for the year. (Only if you are suspected of filing a fraudulent return is there no statute of limitations on an IRS audit.) Similarly, investment records such as annual mutual fund accountings and , partnership K-1 statements must be kept until six years after you have sold the asset. That same holding period applies to receipts and canceled checks for improvements to your home and to documents identifying nondeductible contributions to an Individual Retirement Account. Without verification of the amount and date of the nondeductible contribution, you could be hit with a stiff tax bill when you make withdrawals from your IRA. -- For life. A copy of your will can be stored in a safe-deposit box, but keep the original at home or with your lawyer. In many states your safe-deposit box will be sealed when you die, thus making it hard for relatives to take from it your will and funeral instructions. Moreover, planners generally suggest you keep up-to-date photos and fingerprints of your children, in case of emergency. Finally, make a list of all your records, as well as of the names, addresses and phone numbers of advisers such as your accountant, broker, financial planner, insurance agents and lawyer. Copies of the lists should be kept in the safe-deposit box and with your lawyer or planner. Above all, don't lose control of your paper trail. ''Once you get a handle on your records, don't let go,'' says Victoria Ross. ''It's important to be organized -- for you and your relatives.''

BOX: What you need vs. what you can weed

RECORDS TO TOSS Business receipts for less than $25 Credit-card bills Monthly statements from your bank, brokerage, mutual fund Most canceled checks Receipts for everyday purchases

RECORDS TO KEEP SIX OR MORE YEARS At home: Accident reports Brokerage and fund transactions Insurance policies Keogh statements Loan records Major purchase receipts Stock-option agreements Tax records, including alimony payments, charitable contributions, copies of tax returns, medical bills, partnership agreements, property tax records, 1099s

In your safe-deposit box: Certificates of deposit House records, including deed, title insurance policy, receipts and canceled checks for capital improvements Nondeductible IRA records Partnership statements (K-1s)

RECORDS TO KEEP ALL YOUR LIFE At home: Birth certificates Death certificates List of financial assets List of financial advisers Medical records Powers of attorney Trust agreements Wills W-2 statements

In your safe-deposit box: Alimony agreement Custody agreement Divorce decree Military papers Naturalization papers Prenuptial agreement Videotape or photos of valuables