Extreme Weather Events and Your Wallet
My name is Doris Baker and I am the Financial Educator here at Consolidated Credit.
What we do
Headquartered in Ft. Lauderdale, our mission is to assist families throughout the United States in ending financial crises, and solving money management problems through education and professional counseling.
- Nationally recognized, federally approved, non-profit organization.
- Member of the Better Business Bureau, the United States Chamber of Commerce, and the Association of Independent Consumer Credit Counseling Agencies
Financial Vulnerability & Personal Finance Outcomes of Extreme Weather Events
Each year families across the nation watch their money suddenly disappear as they prepare or react to a catastrophic weather event.
Whether it is a hurricane, a flood, earthquake or a fire, there are many expenses that you need to make to protect your family.
Like stockpiling water, ice, batteries, propane gas and can goods to name a few.
Why Discuss Personal Finances?
Why talk about personal finances when there is a storm coming?
First, because not only our physical homes are vulnerable when a storm hits, but also our finances.
And second, as the saying goes “ Failing to plan is Planning to fail”
Most likely there will be Substantial Indirect Loses for the Area Where You Live:
Factors Likely to Affect the Vulnerability of Individuals
Poverty – the state of being poor
Insecure housing – poor housing quality
Language barrier – unable to speak a common language; barrier to communication
Physical Challenges – affect a primary sense of ability to move and get around easily; could include sight, hearing or motor impairment
Marginalization, as we currently define it, is the act of relegating someone to an unimportant or powerless position—making them feel, if you will, like they’re the notes squeezed into the margins of society. Scrawled. Practically unreadable. Small.
General Consensus for Direct Hit Areas
Keep in mind employment affects, differ based on sector. For example, construction sector will see an increase in employment and earnings during periods of reconstruction.
Disasters and Personal Finance
- Increase in Credit Card Debt by average of $700 (23%)
- 90 day Mortgage Delinquency increase by 10%
- Lower Credit Scores for 2 years following the Disaster of a Average of 46.4 pts.
5 Ways Natural Disasters Can Hurt Personal Finances
From the previous slide we the what can happen to ones personal finances when impacted by a natural disaster. It should be noted the 5 things listed here are the catalysts which can cause the negative financial effects.
Where do I start?
Organization of your finances and updating of your information are things which should be practiced on a consistent basis. Along with at least an annual review of your insurances primarily, home, renters and auto polices. Purchasing disaster-proof storage for important documents is advisable for every household.
Always make a list of your valuables and expensive household items to be stored in your secure disaster-proof storage. In addition, have an emergency fund where funds can be withdrawn ahead of any pending natural disaster threats. Choose your out of town contacts and have a plan of evacuation if necessary
If you are in a flood zone or an area that readily floods following any significant amount of rain have items on hand that can impede flood waters from entering your home.
Make plans for the most helpless and vulnerable family members which are most often the family pets.
Key to Financial Preparedness = A Budget
A budget is a planning tool that helps you reach your savings goals!
But more importantly, it helps you ride an unexpected emergency such as an extreme weather event
There are four steps to making a budget and I will quickly go through them now.
After the storm passes
- First and foremost, be safe. Remain where you are until the official “All Clear” notification is given by local emergency management officials
- Take advantage of grace periods on mortgage and credit card payments
- If you are a renter, your renters insurance pays for damage or loss of your personal property. It does not cover damage to the structure of your home, which is the landlord’s responsibility.
- If you have lost your job, or your employer is no longer in business as a result of the weather event, immediately file for state unemployment benefits
- Be careful who you give personal information to. FEMA, insurance companies and banks may need to get details like social security numbers to verify your identity. Most other organizations DO NO need this information
- As far as working with contractors to get your property fixed, be very careful. Get estimates from more than one licensed, bonded reputable contractor. Check their licenses and permits. Get contracts in writing and find out what neighbors are paying for similar work. Also pay as the work is getting done, not up front.
Thank you for attending today’s webinar.
Please feel free to contact us either by phone or email. Using the contact information provided above.