With disasters such as tornadoes, earthquakes and hurricanes being broadcast across the Internet, we are able to witness the devastating effects of people losing their homes and personal belongings. While you cannot entirely prepare yourself against a natural disaster, you can prepare financially in order to get back on your feet more quickly once an emergency is over.

Preparing before disaster strikes

It is always best to have a plan in place ahead of time. Here are some steps you can take.

Start and maintain an emergency fund. Many experts suggest you should have three to six months’ salary saved up as an emergency fund. While you may only think of this as money to use in the event you lose your job, it can also help ensure you have enough to live on while recovering from a natural disaster. You can read our article on building an emergency fund.

Take out emergency cash. While you may typically rely on your debit or credit cards, what happens if the power goes out and you lose access to your bank account? You need to have actual cash on hand to cover you for at least a week in case you are told to evacuate. (Note that some banks, like Old National, have a mobile banking unit for account access in disaster situations.)

Have adequate homeowners insurance. You should do a regular review to make sure your home is adequately insured. That way, if there is a natural disaster, you will have enough coverage to help rebuild your home and replace personal belongings.  

Keep a list of contact information for creditors and insurance companies. If a disaster has destroyed your home, the last thing you will want is to be searching for the phone number of your insurance company. The same is true of your creditors, who may be in a different part of the country and unaware of your situation. Keep phone numbers and web site addresses in one place, so you can easily access them when Internet and phone service is available.

For more in-depth planning, the Federal Emergency Management Agency (FEMA) offers The Emergency Financial First Aid Kit (EFFAK) with guidelines and forms to help you prepare for a disaster. You can download a copy for free.

Getting help after a disaster

After the disaster passes, a worst-case scenario may be that you have no home or job to return to. There are ways of getting help.

Apply for a Federal Emergency Management Agency (FEMA) grant. FEMA provides emergency relief to people following a natural disaster. You may be eligible for FEMA funds up to $33,000 through the Individuals and Households Program and FEMA directly. This assistance can help to repair your home to make it livable again or will pay for the expense of temporary housing. Visit the FEMA site.

File for unemployment.
If you cannot go back to work right away, apply for unemployment. The unemployment office in your town can help you, or you may be able to file for assistance through the FEMA site.

A natural disaster can strike anywhere at any time. No matter what type of disaster it is, it can leave devastating results. While you may have emergency resources ready to go like bottled water, flashlights, extra food and batteries, it's also important to consider if you are prepared financially for the aftermath.

Need to start your emergency fund?

Set up direct deposit to a savings account, or automatic transfers from your checking to savings, and you'll be reaching your savings goal in no time! We even make it simple to open your savings account online.

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