Financial management before and after a natural disaster

Financial management before and after a natural disaster

Inrnthe last few centuries, I think it is safe to say that humanity has gonernthrough an incredibly fast evolutionary period, where advancements in allrnfields started picking up speed at an impressive rate. For example, in 40 yearsrnwe have gone from phones stuck in a power socket to mini-computers that can fitrninto our pockets, which are better than the one who sent Apollo 11 to the moon.rnIt is flabbergasting just thinking about it.

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Withrnthis said, this rapid advancement didn’t come without its price, and it is arnvery heavy one to pay. Factories, cars, forever-growing cities, lifestylernchanges, they have all contributed to pollution and climate change. Because ofrnthis, natural disasters such as floods, hurricanes, tornadoes, wildfires havernincreased in frequency over the last few years. Because of these changesrnhappening in the time of a person’s lifespan, people need to readjust theirrnapproach towards natural disasters and know how to prepare and how to react inrnthe case of such events.

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2017rnhas been an especially rough year, with disasters claiming the lives ofrnhundreds of people and costing billions of dollars in property damage. Two ofrnthe most damaging disasters recorded last year have been Hurricane Irma and thernCalifornia wildfires. Many people were affected, both emotionally andrnfinancially, by them, so in this article, I talked to some experts and gatheredrnsome tips on how to prepare your finances in case a natural disaster hits, andrnwhat to do after it.

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Before a naturalrndisaster Get adequate insurance

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Althoughrnthis step may seem obvious, many people do not take the time to thoroughlyrnthink through their insurance plan. It is suggested that everyone should lookrnup if their area is known to be affected often by a type of natural disaster,rnbe it flooding, hurricanes or earthquakes. If so, look over your insurance planrnand see if the most probable damages are covered. Talk to financial advisors orrnto experienced lawyers to see what extra steps you should take. For example,rnmost homeowner insurances do not cover damages done by flooding. If you live inrnareas that are prone to these disasters, such as Florida, for example, it isrnrecommended to take out a flood insurance.

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Prepare anrnemergency fund

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Ifrnyou know that you live in an area that is at risk of natural disasters, yournshould talk with your family about opening an emergency fund. Each month yournshould save a little bit of money just in case the unthinkable happens. Maybe,rnin the event of a tornado, someone from your family was injured, or the place inrnwhich you worked was destroyed and you won’t have a steady income anymore.rnHaving a financial safety net can make a huge difference in these types ofrnscenarios.

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Save all importantrndocuments virtually

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Thisrnis a very important piece of advice that many people do not seem to thinkrnabout. In the event of a natural disaster, it is quite common that importantrndocuments, such as home ownership documents, documents from your bank,rninsurance papers, can get lost or destroyed. Losing many of these papers couldrnput a massive dent in your financial stability. JohnrnM. O’Brien, an attorney practicingrnpersonal injury in Elk Grove, California, had this tornsay: “By losing such important documents in the event of a natural disaster,rnyou will see that many perks will become unavailable to you. My advice is forrnpeople to take every important document, contract, file, whatever is necessaryrnfor your financial stability, scan them into your computer and then upload themrninto the cloud. Not only will you be the only one who can access them, but inrncase something were to happen to the physical copies, you will have them as a backup.rnBecause of this, chances of your finances suffering or being denied certainrnpayments decrease.”

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After a naturalrndisaster Manage your finances

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Althoughrnit may be a very emotional period, there is no time to lose and it is veryrnimportant to act as quickly as possible. See what damage your assets havernsuffered. Think about the costs that come with repairing your property.rnHurricane Irma devastated Florida, causing hundreds of millions of dollars inrnproperty damage. Many people were left homeless and they had no means to coverrnthe costs. Attorneysrnat the Law Offices of Sean M. Cleary had this advice for the readers: “It is paramount that yournmicromanage your finances. I’m not only talking about speaking with yourrncreditors and the insurance companies, but you also need to take everythingrninto account. Try and call your employer, see where you are currently standingrnwith your job. If you are subscribed to any services, such as newspapers, TVrncable, internet, cancel them! Every dollar saved will get you closer to gettingrnback on your feet.”

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Pay attention to scammers

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Duringrntimes of crisis, there are a lot of people who try to take advantage of thernmisfortune of others. If you get loan offers that seem to be too good to berntrue in times like these, they probably are. Never get into deals that requirernyou to pay money to get money or to give your credit card details. If you needrnloans, talk only with trusted officials.

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Talk with yourrncreditors and insurers

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2017rnhas been the most destructive wildfire year in the entire history ofrnCalifornia. The total estimated costs are believed to be approximately $180rnbillion, thousands of homes and businesses were destroyed and 43 people haverndied because of the fires. Smoke filled the air and spread for miles, making itrnhard to breathe and injuring hundreds of civilians and firefighters alike. Thisrnnatural disaster massively affected people’s lives in many ways, either throughrninjury, relocation or property damage. As a lawyer handling complex financialrnissues, Kevin S. Neiman, says: “The costs of this disaster were colossal. Victimsrnand insurance companies alike struggled to keep up with them. In cases likernthese, there are a lot of chances that you may not be able to stay afloatrnfinancially. You may be forced to file for bankruptcy, to postpone your creditrnpayments or you may need to take out a loan. It is very important that you talkrnto your creditors and insurers and explain the situation to them. If you can’trnpay them, try to suspend your payments for a while so you can gather yourrnfinances together. If you are eligible, apply for a Small BusinessrnAdministration disaster loan. Talk to all insurers about what you have coveredrnand, after you find out where you stand economically, make a plan on how tornproceed next.”

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