As we approach the more active months of hurricane season, a crucial element that many Americans overlook regarding their financial security is their level of preparedness for an emergency or a natural disaster. Today, we want to briefly review the essential steps inspired by FEMA’s Emergency Financial First Aid Kit (EFFAK) to protect your assets before a disaster strikes.
Actionable Steps: Securing Your Assets & Documents
- Secure Vital Records and Asset Inventories
- Document Vaulting: Store original financial, legal, and medical documents in a fireproof/waterproof safe, or upload encrypted digital copies to a flash drive or the cloud.
- Visual Asset Logs: Take video or photos of high-value personal property, home interior, and major assets. This simplifies filing home/renters insurance claims later.
- Cash Flow & Liquidity Strategy
- Emergency Cash Reserves: Keep a small reserve of physical cash in small bills ($5s, $10s, $20s) at home. ATMs and card processing systems often fail during widespread outages.
- Direct Deposit Setup: If you receive Social Security, pensions, or annuity payments via paper check, transition to direct deposit. This prevents delivery delays or stolen mail during disruptions.
- Audit Policy Limits & Exclusions
- Understand the Gaps: Homeowners insurance typically does not cover flood damage. Consider a policy through the National Flood Insurance Program (NFIP).
- Mind the Waiting Period: Remember that flood insurance policies usually carry a 30-day waiting period before coverage takes effect.
Emergencies unfortunately attract imposter scams. Government agencies (like FEMA or the IRS) will never text or call asking for immediate wire transfers, bank numbers, or account logins. If you receive suspicious communications following a disaster, contact the Federal Trade Commission (FTC) at ftc.gov/complaint to report the fraud.