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Disaster Planning: Have You Made Plans for Your Personal Finances?

disaster planning

This is the time of year when violent spring storms can spawn dangerous tornadoes here in the Midwest that can cause significant property damage and, in a worst-case scenario, also result in loss of life.

Most Midwesterners know the importance of preparing for this kind of natural disaster by stockpiling supplies like water, canned goods, flashlights, batteries and so forth. But have you ever thought about making disaster preparations for your personal finances? A natural disaster could wreak havoc on your finances if you haven’t taken steps ahead of time to prepare for the potential impact.

Disaster Priorities

Think about it: If a tornado or other natural disaster were to strike suddenly, you would likely only have minutes to react. Your first priority will probably be making sure you and your family are safe — not worrying about safeguarding your financial records. Therefore, you should start thinking now about what kind of advance financial preparations to make before disaster strikes.

Start by gathering and organizing your important financial records and documents. For most families, these include the following:

  • Financial and legal records — These are all the documents related to your bank and investment accounts, insurance policies, home mortgage, taxes, credit cards, car payments and the like. Also locate your estate planning documents, such as your last will and testament, living will and durable powers of attorney.
  • Personal identification documents — These include birth certificates, passports, Social Security cards and driver’s licenses for all members of your family, as well as marriage and divorce licenses. You will need many of these to prove identity and possibly apply for state and federal assistance after a disaster.
  • Financial professionals’ contact information — You will want easy access to the contact info for your financial advisor, insurance agent, banker, wealth manager and family attorney. There’s a good chance you’ll need to get in touch with these and other financial professionals quickly after a disaster.
  • Medical and healthcare records — These records might be crucial in the aftermath of a disaster if you or any family members are injured and need medical attention. They include physician and hospital contact information, health insurance policies and ID cards, immunization records, and current medications and prescriptions.

Review Your Documents

With these records and documents organized and in hand, now would also be a good time to review them to make sure they are accurate and still relevant. For example, are all phone numbers and email addresses current? Also, changes in your family and financial situation could affect your will, insurance policies and estate planning documents.

Now is also the time to determine how you will safeguard and store your critical documents and records. For paper documents, use a fireproof and waterproof cabinet or safe or keep them in a bank safe deposit box. For electronic documents, use an external hard drive or flash drive or, better yet, utilize cloud storage. All electronic documents should be password-protected.

In addition, you should take photographs or video of all your possessions and store your photos or video in a safe place along with your documents and records. You might also consider storing some cash in a safe place that you can use for immediate post-disaster expenses. If electricity is out for an extended period of time, ATMs and even credit card processing equipment may not work.

Start Preparing Now

Many people think that they will never be impacted by a disaster because disasters always happen “somewhere else, to somebody else.” Maybe this is true, but it never hurts to be prepared just in case a disaster strikes close to your home.

Please contact us if you have more questions about preparing a disaster plan for your personal finances. We can help you determine the most important steps for you and your family to take.

The commentary is limited to the dissemination of general information pertaining to Frontier Wealth Management, LLC’s (“Frontier”) investment advisory services. This information should not be used or construed as an offer to sell, a solicitation of an offer to buy or a recommendation for any security, market sector or investment strategy. There is no guarantee that the information supplied is accurate or complete. Frontier is not responsible for any errors or omissions, and provides no warranties with regards to the results obtained from the use of the information. Nothing in this document is intended to provide any legal, accounting or tax advice and Frontier does not provide such advice. This information is subject to change without notice and should not be construed as a recommendation or investment advice. You should consult an attorney, accountant or tax professional regarding your specific legal or tax situation.