Don’t Let Your Finances Blow Away in the Wind
Eileen St. Pierre, The Everyday Financial Planner
I wrote this column back in May 2010. The recent tornadoes experienced by our friends and neighbors in Oklahoma prompted me to release it again. Unfortunately, the need for safeguarding and updating your financial information is always there.
You know the drill. When spring rolls around, get ready for the thunderstorms. Listen for the tornado sirens. Glue yourself in front of the television watching hours and hours of storm damage coverage.
We talked about it earlier. Have you gotten your records in order? If you still haven’t gotten around to it, now is a good time to start. If you are one of the unfortunate victims of this spring’s storms, you will be glad you did.
Here are a few tips to get you financially prepared for this spring’s storm season:
Tip #1 – Get an insurance checkup
Round up all your insurance policies. Are they all up-to-date or did you forget to increase your homeowners coverage because of that extra room you added on? Do you have the right amount of coverage? Make sure you know how much your deductibles are because these are the amounts you will have to pay out-of-pocket before your insurance kicks in.
Tip #2 – Update beneficiaries
It may have been a while since you last updated the beneficiaries on your insurance policies, retirement plans, and investment and bank accounts. Your family may have grown or you may have gotten remarried. Do you really want your ex to be the primary beneficiary on your life insurance policy?
Tip #3 – Take inventory of your safe deposit box or home safe
Now where did you put that key to your safe deposit box? Find it and then go to the bank and inventory everything you have in there. Is there anything you need to add? Are there any original documents you may want to make a copy of to keep with you at home?
Tip #4 – Create a financial “grab and go” kit
In case you need to evacuate or go to a shelter, you want to be able to grab your essential documents in a hurry. This will make it easier to file an insurance claim afterwards. Your kit should include:
- Auto and homeowners insurance policies
- Important financial and legal records
- Passports and birth certificates
- Lists of your home inventory and safe deposit box contents (with key)
- Owner’s manuals and receipts
- List of account numbers, passwords, important web pages and phone numbers
- Flash drive containing important computer files
Tip #5 – Have a post-disaster plan
What if your car is damaged or destroyed? How will your kids get to school and how will you get to work? It may take awhile to get that rental car from the insurance company.
- If your home is damaged or destroyed, can you stay with family or friends? There may not be a hotel nearby so you may have to travel to get to work or school.
- What if your workplace is destroyed or damaged? You may not get a paycheck for a while. Now is when you need to use your emergency cash reserves – the 3 to 6 months’ of living expenses you put into a savings account for this very event.
I had the wonderful opportunity to learn from a survivor of the February 2009 Lone Grove tornado. She mentioned that there are a lot of things you would never expect to have to deal with afterwards. She also said that she felt truly blessed to have survived and been surrounded by the love of more friends and strangers than she could ever thank. She allowed me to share her story to help teach others how to safeguard important documents – Click here to watch.
Visit my Basic Financial Management page for more information.