I get statements every quarter from different fund companies. Which should I keep?

QUESTION: I get heaps of statements every quarter from the different fund companies that I deal with. Which statements should I keep and which can I toss out? What about statements for funds that I no longer own?

ANSWER: You certainly aren't the only fund investor who's feeling overwhelmed with paperwork. "Every quarter, a diversified fund investor needs to beware of death by paper cuts," says Kevin McKinley, a certified financial planner based in Eau Claire, Wis. So here's a review of what you should keep and what you can pitch.

First off, you should retain all year-end statements for the entire period that you own a fund. These are invaluable, as they provide the cost-basis information necessary to calculate your tax hit when you sell the fund, notes McKinley. Should you throw this information away, your fund company should be able to recreate it for you -- but keep in mind it could take weeks for them to get it to you.

What about year-end statements for funds you no longer own? Hang on to those for up to five years, "in case you are subject to an IRS audit" says McKinley. This is also true of funds that you've rolled over from a 401(k) into an IRA. "It's possible that you would have to show (the IRS) how the money got to where it is," says Sue Stevens, director of financial planning for fund-tracking firm Morningstar.

As for quarterly statements -- and in the case of some fund companies, monthly statements -- Stevens suggests that you retain the ones for the current year, and then toss them when you receive the year-end summary. (When you do that, be sure to shred them, to protect your financial data.)

You probably also want to hang onto a fund's annual report for one year. Ditto for the semiannual reports. Remember, these twice-yearly reports are usually your only opportunity to see a complete list of a fund's holdings. Granted, the fund manager may have sold some of those stocks or bonds by the time you receive the report, but these documents can alert you to odd activity, such as an unusually high percentage of foreign stocks or derivatives, for example. After a year has passed, however, feel free to toss them out. You can also obviously throw out any marketing materials you don't want.

Last, it doesn't hurt to hang on to the original prospectus you received when you bought the fund. If the fund isn't sticking to its original mandate, at least you'll have ammunition, notes Stevens, in case you take your grievance to the fund company.