NEW YORK — For those residing in areas vulnerable to natural disasters such as wildfires, floods, or hurricanes, financial readiness extends beyond securing insurance. Both the Federal Emergency Management Agency (FEMA) and the Red Cross suggest several essential measures. These include organizing vital documents and contact information securely, capturing photographic or video evidence of your home’s interior and valuable items, and ensuring you have cash readily available, particularly if ATMs or digital banking systems fail.
Lisa Berdie, who oversees policy and research at the Financial Health Network—an organization dedicated to serving underprivileged consumers—refers to these preparations as “preparedness.” She emphasizes the significance of investing in efforts to mitigate climate-related risks and lessen the potential financial impact. Berdie notes, “It’s crucial to recognize that not only high-profile disasters but also more frequent, smaller-scale events, such as heat waves, can lead to serious financial strain for households.”
To enhance financial preparedness and organization for potential disasters, individuals should take the following steps: First, gather and evaluate key documents. FEMA recommends collecting essential paperwork, including birth and marriage certificates, Social Security cards, military records, and identification tags or vaccination documents for pets. Additionally, individuals should organize housing payments, utility bills, banking information, insurance policies, tax documents, and records of income sources, as well as wills.
Keeping track of medical documents is vital; this includes health insurance details, lists of allergies, immunization records, prescription information, and any relevant medical device records. It’s also important to compile a list of critical contacts, such as:
1. Landlord or mortgage contacts
2. Healthcare providers like doctors and dentists
3. Insurance agents
4. Representatives for military and disability benefits
5. Suppliers of assistive technologies
6. Legal advisors
7. Financial consultants
8. Banking contacts
9. Community and religious organization contacts
FEMA underscores the importance of storing essential phone numbers in multiple places, not just on your mobile device.
The rationale behind maintaining this information is that it may be necessary to validate your identity or income when seeking disaster aid. You might also need these documents to revive financial accounts if paper checks are lost or if you are unable to access online services. Other records play a crucial role in confirming the identities of household members, keeping in touch with family and friends, liaising with your employer, and applying for other support.
To further streamline financial organization in preparation for potential disasters, individuals who lack certain documents should reach out to relevant agencies to obtain replacements. For those who receive paper checks for federal benefits or salaries, transitioning to direct deposit or opting for prepaid debit cards can enhance efficiency. FEMA recommends saving or printing automatic payment confirmations for bills like rent, utilities, and loans, and downloading financial management apps can provide added convenience during emergencies.
Documenting your possessions and living space through photos or video is also a smart way to keep a record of valuable items.
Another critical step is to store cash alongside your important documents. Both FEMA and the Red Cross recommend that people have cash readily available in case ATMs are nonfunctional or services are disrupted. The amount should depend on your family’s immediate needs for essentials like food, medication, and gas.
It’s also vital to keep your records up-to-date. This includes reviewing and confirming the accuracy of insurance policies and financial papers, such as those for home, auto, or rental insurance.
Lastly, ensure that all documentation is stored securely. Paper and digital copies should be kept in safe and secure locations. Options include fireproof and waterproof containers, bank safety deposit boxes, or with trustworthy friends or relatives. If using a safety deposit box, be sure to understand local regulations regarding who can access the box if the primary account holder becomes incapacitated or passes away.
For digital storage, utilize password protection for electronic versions on a flash drive or external hard drive, which should also be stored in a safe space.
Consistently review and refresh your records, particularly following significant life changes, whether it involves new insurance plans, relocation, account management, marital status changes, family additions, or retirement planning.
Preparing for unforeseen disasters is crucial to maintaining financial stability and ensuring your readiness should the unexpected occur.
