It seems that there has been an abundance of natural disasters over the past few years. Some of those who have been hit have begun to get prepared in case of future emergencies they may face. Unfortunately, those of us who have yet to be hit only read about it in the news and we do not think it will ever happen to us. Oh, we may have a candle or two put aside in case of a power outage but we never think of being financially prepared for an emergency.
Very few, however, consider the need to be prepared for a financial emergency in their plans. From keeping an evacuation box with important documents to setting up an account with emergency funds, preparing now can be the difference between financial security and financial crisis.
Create a household inventory for items of significant value and locate originals of important financial and family documents. Store original documents in waterproof bags in a safe deposit box or durable “evacuation box” and photocopies in a safe place. Use a CD to back up key documents on your computer. If practical, store copies with friends or relatives who live outside the area.
Check with your insurance agent and check your policies to make sure you understand what your coverage is on such things as floods, fire, earthquakes etc. Make sure that you have your policies safely stored for future access.
Since we really never know what can hit us and how fast it can come upon us I like to keep a few hundred dollars in small bills hidden away for quick access. Let’s face it if the power is out the ATM’s won’t be working and we may actually need to buy something with cash.
Keep a couple of lists with all your important numbers on them in safe places that you can get to. Include people like your doctor and family members so you can contact them in case of emergencies. Include your insurance company/agent and your credit card numbers in case you need to quickly retrieve account information.
The last but by no means the least make sure you have a funded emergency savings account. This account should be separate from any other account and contain enough money to cover at least three to six months of living expenses. This type of account will lift a heavy burden from your shoulders should an emergency occur.
Follow these guidelines to ensure you and your family are protected financially as well as physically. If you would like to learn more on how to gain control of your finances all the time then head on over to the report at Money Management Made Easy.