5. Build a physical system with only three containers
More containers means more decisions, and more decisions means the system fails. Three is the number that works for almost every household.
Container one is a fireproof document box or a safety deposit facility for the keep-permanently tier. A basic fireproof box costs about $50, CA$70 or £40 and lives at the bottom of a wardrobe. Everything in it should also be scanned, because fire is not the only way papers disappear — floods and moves take more. Tell one other person in the household where it is and how to open it.
Container two is the active file: a concertina file or a small box of hanging folders with one folder per live category. Property, Vehicles, Money, Health, Insurance, Warranties, and one per person for individual paperwork. This is the file you actually touch, and it should live somewhere reachable without standing on a chair, because an archive on a high shelf silently stops being used.
Container three is the archive: a labelled box per tax year for the seven-year tier. Each January, the oldest box gets shredded and a new empty one starts. That single annual action keeps the archive from ever growing past seven boxes, and it takes twenty minutes.
Label everything on the end that faces out, not the top. Write in marker, not pencil, and write the year large.
Then shred the shred bag. Use a cross-cut shredder rather than a strip-cut one, feed it slowly, and expect to do it in several sessions since domestic shredders overheat after ten minutes. A large backlog may be cheaper handled by a local secure shredding service, which typically charges by the sack.