Whether anticipating the arrival of a nasty bear market or severe hurricane, taking some preventative action up front can help to alleviate headaches and financial loss on the back end.
Hurricane Harvey striking Texas in 2017 was the first Cat-4 hurricane to make landfall in the U.S. since hurricane Charley wrecked South Florida (also Cat-4) in 2004, causing over $16 billion in damage.
It may look and feel like a ‘third world’ country in South Florida after a major hurricane strikes, with stores boarded up, trees strewn across roadways, traffic lights down or inoperable and police officers in the streets upholding evening curfews in pitch blackness.
Not having access to food, gas, electricity, medical supplies or even mobile phone service for days or weeks on end can wreak havoc on your life, patience and finances.
While you may be a wise Floridian to beat the lines at the gas stations and Publix before they run out of gas and water, propane, beer and hamburger patties before boarding up your home, the following financial steps should be considered before and after experiencing a catastrophic hurricane or other natural disaster.
1 Get cash in hand:
Make sure to stock up on cold-hard cash right before and or right after a hurricane. Banks may be closed or days or weeks on end after a natural disaster while ATM machines may run out of money or be inoperable.
Many local vendors that open their doors to the public after a hurricane may be on a “cash-only” economy while doling out pizza’s and cheesesteaks from their gas ovens, as most credit card payment systems (mobile to wi-fi) may be inoperable.
2 Minimize identity theft:
Do not to leave mail in your mailbox or trash cans outside your property that may have credit card information or other personal data lying around. Also, beware logging onto unsecured internet connections when away from home where you may be a target of identity theft if you hit the road to escape the storm. The last thing you may need is an identity theft disaster.
3 Safeguard your small business:
If you own and run a small business, make sure to lock down, protect or remove your valuables, computers and even hard copy client data that could put a wrench in your productivity if wiped out by a natural disaster.
Consider where you may be able to set up a temporary office space for days or weeks on end so that you may be able to continue working if needed. Most important, call and email your clients! Your clients will thank you for reaching out whether you are caring for people’s pets or portfolios.
4 Track emergency expenses:
Save all your receipts if you can’t live in your house after experiencing major damage and make sure to keep detailed records of all additional expenses. Some homeowners’ policies may cover you for additional living expenses and provide advance payment options.
Contact your mortgage company and auto loan lender as soon as possible to report your claim and update them with your temporary address.
5 Organize household bills & finances:
Make a list of all your personal bills and make sure to pay online or by phone when due. Missed payments are not uncommon after a natural disaster strikes so make sure to call your home mortgage company and other lines of credit to see if they will allow you to negotiate a lower payment for a few months or extend your grace period.
Make sure to set up “paperless” billing options where possible and have your mail redirected to where you are temporarily living or to a post office box. Cut back or eliminate less important expenditures you will not be utilizing for the short term such as your cable and internet bills.
6 Secure documents & digital storage:
Make sure to store important documents in a waterproof, portable container as well as to take photos of them and store on a thumb drive. This could include your will, trusts, insurance policy contracts, passports, social security cards and family records (birth, marriage, death certificates.)
7 Photograph & Video your auto & home:
Review your home owners or renters insurance coverage and deductibles and make any adjustments where warranted. Many people pay their premiums for years without much of an idea on what coverage they may actually have.
Take photos and videos of your car, property, home, roof, valuables and furniture before a major hurricane, flood or other natural disaster strikes. After it is safe to return home (if you left!) , take new pictures and videos as soon as possible to document any residual damage to your home and auto.
While it is important to secure and protect your property, do not make any major changes or arrange a clean-up or repairs until your insurance adjuster can come out and take their own pictures and document your claim.
8 Vet contractors:
Once you get your home damage appraised by your insurance adjuster and find out how much your insurance will pay for your repairs, take time to vet out and hire contractors.
Unfortunately, in times of peril and need where there is more work than can be handled, many unscrupulous contractors will come out of the woodwork and take advantage of less suspecting people. Under no circumstances should you pay a contractor up front or in cash. Make sure to look up your contractor on line and get referrals if possible.
For more information on our firm or to request a complementary investment and retirement check-up with Jon W. Ulin, CFP®, please call us at (561) 210-7887 or email [email protected].
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The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual.