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Place the the cabinet in the direction that you want your files facing. With a lateral file cabinet you have the choices of files facing left, files facing right or files facing forward.
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Insert lateral file rails if you have chosen to have your files facing forward. Use the rails to divide the width of each file drawer into sections sized to accommodate the width of the expandable hanging files.
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Insert the expandable hanging files into your lateral file cabinet, facing in the direction you have chosen.
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Create file labels by writing one category title on each label. Put the file labels in alphabetic order or some order that makes the most sense for your needs. Affix the file labels to the expandable hanging folders, placing the first label on the far left of the first expandable hanging file. Place the label on the next hanging file so that it sits to the right of the first label. Continue until all of your files are labeled. When you get to the far right of a hanging file, if you have more categories left, start back at the far left again.
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Label expandable file folders for sub-categories by writing a sub-category title on the tab at the top of each folder. Place the file folders in the hanging file labeled with the appropriate category. For example, if you have created a hanging file with the category "taxes," label file folders for each tax year.
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Sort your documents and file them in the respective category and subcategory files.
