Organize Your Financial Life Ahead of Natural Disasters

Natural disasters can strike with little warning, disrupting your life and your finances. From hurricanes and wildfires to earthquakes, tornados, and floods, preparing your financial life in advance can help you recover more quickly. Here's how to ensure your finances are disaster-ready.

Create an Emergency Fund: Having cash on hand is crucial when ATMs and banks may be inaccessible. Aim for at least three to six months' worth of expenses in an easily accessible savings account. If possible, keep some cash in a secure location at home.

Protect Important Documents: Store essential financial documents in a waterproof, fireproof safe or a bank safety deposit box. Include identification (passports, Social Security cards, birth certificates, marriage certificate), insurance policies (home, auto, flood, health, life), health information (health insurance and pharmacy cards, records of immunizations and allergies, copies of prescriptions, records of medical devices or equipment), property deeds, vehicle titles, loan agreements, wills, trusts, and power of attorney documents. Also consider compiling a list of financial contacts - including your bank and credit card companies, insurance providers, mortgage and loan servicers, accountants, and financial advisors. For added security, create digital copies of all of this information and store them in a cloud-based service.

Review Your Insurance Coverage: Check your homeowners, renters, and auto insurance policies to ensure you have adequate disaster coverage. Standard policies may not cover floods or earthquakes, so you may need separate policies. Update your coverage as needed and keep an updated inventory of valuables. Photographing or recording a video of the rooms in your home and any valuable belongings is advisable as a form of record keeping.

Set Up Automatic Payments and Online Banking: In case of evacuation, you'll want to ensure your bills are paid on time. Set up automatic payments for critical bills such as rent, mortgage, utilities, and insurance. Familiarize yourself with online banking and mobile apps so you can manage your finances remotely, if necessary.

Secure Access to Credit: A disaster may require unexpected expenses, from hotel stays to home repairs. Ensure you have access to credit, whether through a credit card with a sufficient limit or a personal line of credit. Avoid maxing out cards before disaster season.

Communicate Your Plan: Ensure family members know where to find important documents and understand your emergency financial plan. If you have a power of attorney or executor, make sure they are informed about your financial arrangements.

Financial preparedness is as essential as having a go-bag or knowing your evacuation route. By organizing your finances ahead of time, you can focus on staying safe and rebuilding after a disaster strikes.