10 July 2012
By Lila Quintiliani, AFC ®
Military Saves Assistant Coordinator
You’ve got a flashlight, batteries, a weather radio and gallons of water. So you’re all prepared for an emergency, right? Maybe not. See, you also need to be financially prepared for emergencies, or you can take a hard hit right in the wallet when disasters, natural or otherwise, strike.
Here are some things to consider when it comes to emergency financial preparedness:
- How’s your insurance coverage? If you are a homeowner, do you have adequate coverage for your possessions? Do you live in a flood-prone area, even if the area is not formally designated as such on a flood map? If so, you may need to buy a separate flood policy, because most regular homeowner’s policies do not cover damage from flooding (or earthquakes). If you live in an apartment or government housing, do you have renter’s insurance? While some government housing may come with limited renter’s coverage, it varies from installation to installation, and rarely covers the cost of even a fraction of your household goods. The best bet is to find a separate renter’s policy which can cost under $20 per month.
- Are your financial records in a safe place? Here are some financial records that the Red Cross recommends you keep at hand in a “disaster kit,” a portable, waterproof, fire-resistant box that you keep nearby at all times:
- Federal and state tax returns (if you have room, store all of your returns here, but if not, at least keep the three most recent ones in the kit)
- Home improvement records
- Inventory of your possessions
- Warranties and receipts for major purchases
- Appraisals of jewelry, collectibles, artwork, and other valuable items
- Credit card records (or at least your account number and login information)
- Retirement account records (or account number and login information)
- Recent checking, savings, and investment account statements (or account number and login information)
- Rental agreement/lease and/or mortgage documents
- Recent pay stubs and employee benefits information
- Backups of critical digital information, such as any accounting files
- Safe deposit box information (location, contents, and key)
- In addition to these items, you may want to keep a copy of your will and any powers of attorney you may have.
- Do you have any cash on hand? In this day and age it’s all too easy to pay for everything with plastic. But it’s a good idea to have some cash stashed in a safe place, since credit card readers and ATM machines won’t work when the power is out. It’s also wise to keep a few blank checks with you.
- Written by Super User
- Category: Blog
- Published: 10 July 2012