Documentation-The Storage Problem

One of the issues that is often overlooked but needs to be dealt with on a proactive basis is that of document storage. When I look at the paper that clients generate it is truly a monumental task. Legal documents, trade confirmations, bank staements, invoices, all generate paper. I have noticed of late that a large number of these documents are now generated digitally. Although it cuts down on the amount of physical paper it has now been replaced by digital paper.

I have three bank accounts, three credit cards, two active brokerage accounts and what they provide me with is the following:

1. Monthly statements-so I have three banks accounts which means that I have thirty six documents a year.

2. Three credit card statements each month so that's another thirty six documents.

3. Two brokerage accounts with another twenty four statements a year.

So just with these three items I have almost one hundred documents a year. High net worth accounts will generate even more paper given that underneath each monthly statement are transactions - a trade confirmation, ATM deposit or withdrawl, credit card charges, cash transactions where you're handed an invoice.

Ultimately, the question is how are we going to manage all this paper? Fortunately, as I mentioned, many of these documents are sent to us digitally. The digital copy can be stored in the cloud. But the information still have to be filed in electronic file folders. In the absence of doing that it just becomes another mess to manage.

So we need to look for file storage solutions that meet a number of criteria. The solution needs to be easy to use and secure. There has been a lot written about cloud storage security. It probably makes sense not to get too carried away. Although there may not be a prefectly secure solution we need to step back and have a look as to how much of the information is actually sensitive and how much isn't.

Another important aspect of using the cloud for documentation storage is the ability to share files. File sharing is important. It is through file sharing that my clients will be able to communicate with me: send documents, trade confirmations, invoices, etc. I, in turn, will be able to stay in touch with my clients as well. File sharing will allow me to provide financial statements, trial balances, expense analysis, revenue analysis, etc.

One of the solutions that I am thinking of using is DropBox. DropBox has many positive features including a reasonable security platform, ease of use, reasonable cost. New clients will be introduced to DropBox, although other cloud document storage services are available.

Another consideration on moving documents around is email. As we all know, email is not a secure means of communications. Everyone pretty much acknowledges that. We all rely on the fact that there millions of emails sent every day with the potential for confidential information to get into the hands of third parties minimal. Again, the question is how much of this is really sensitive information. Having said that, I will ask my client to use a secure email platform called Tutanota. It's free and provides a higher level of security that most email platforms. So I will be asking clients to sign up to ensure the confidentiality of our communications.

Here is a third party review of Tutanota. As the review mentions, it's not perfect, but it's a lot better than most alternatives. Although it may seem a bit cumbersome to use at times, the added security for sensitive information is worth the additional effort in my opinion.

#highnetworthindividuals #secureemail #documentation