By Stephanie Song
No matter how advanced technology gets, there will always be a number of core applications where nothing but ink and paper get the job done. For entrepreneurs, there are many crucial documents that have to be preserved and tracked in physical form. Once you start managing large numbers of assets, it’s vital to have a smart method for filing and storing your most important documents.
Why You Need A System
As noted above, physical documents are still considered the unassailable standard in establishing key financial questions like ownership. Deeds, titles, stock certificates, contracts, and other important documents are essential in tracking your business dealings. Losing documents like this can expose you to enormous headaches and they are often difficult, if not impossible to replace. Not being able to lay your hands on these documents when you need them will cost you time and money.
Depending on your business (e.g. independent business ownership, property rental, etc.) you will have different classes of documents whose preservation is vital. Take the time to define these documents and establish procedures for protecting them. If you are just taking your first steps into entrepreneurship, it is an excellent idea to consult with an experienced financial professional like an accountant to make sure you understand which documents are critical.
Independent Vs. Managed Document Storage
Once you know what information you need to preserve, the next big question you face is where to do it. Broadly speaking, you can either maintain exclusive control over your documents, keeping them in your home or office, or entrust them to a third party. Storing documents in a safe deposit box at a bank is the classic example. Both options have their strengths and weaknesses.
Relying on someone else to safeguard your legal documents allows you to share some of your responsibility for them. Banks and dedicated document management companies have extensive resources and procedures for protecting documents that it can be difficult for you to match on your own.
Of course, entrusting someone else with your documents will reduce your level of access to them. This is something you should account for when establishing your own document management procedures. Documents you need to refer to frequently may have to be kept close at hand.
Note that wherever you physically store your documents, they should be well organized. A safe deposit box that’s used as an open dumping ground for all of your important papers can be a nightmare to deal with when you actually need one. Make sure you have a clear and consistent system for sorting your documents.
When And How To Go Digital
While original copies are indispensable for some of the most important transactions you can make, they’re not usually required for your day-to-day operations. This doesn’t mean that they don’t come in handy, though! The information recorded on key documents can be extremely useful both to yourself and to the people and organizations you do business with.
Today, digital copies of key documents are often acceptable for a wide range of different purposes. Once the volume of documents you are preserving grows large enough, investing in digital copies can be a very smart move. It allows you to refer to your documents without physically digging them up. Digital versions are often acceptable for low-level transactions (a financial disclosure vs. a transfer of ownership, for instance), and having access to your information in this format can save you a lot of time.
Remember that the information they contain is nearly as important as your documents themselves. Digital copies also need to be stored properly to keep your information safe. If you use an independent company to digitize your documentation, review their security policies thoroughly. Sensitive digital data should be backed up in multiple locations to preserve it in the event of equipment failure.
Being an entrepreneur is all about taking responsibility for your finances. While keeping track of dollars and cents is important, you also have an obligation to keep tabs on the important documents your work generates. Developing a consistent plan for sorting and storing those documents is an important part of staying on top of your business.
Stephanie Song is a freelance writer and self-proclaimed technophile, who loves keeping up with the latest gadgets and technology. You can check out her site, InkTonerStore.com for all your quality ink and toner cartridge needs.