2017 was a historic year for multiple reasons, but perhaps none more impactful than in the context of natural disasters here in the United States. 2017 was a record year when it came to cumulative damages from “weather events,” with the total cost reaching $306.2 billion. This number shattered the previous record set in 2005 of $214.8 billion, which was disproportionately caused by Hurricane Katrina in New Orleans.
When people think about 2017 in terms of natural disasters, Hurricane Harvey, Irma, Maria, and the California wildfires probably come immediately to mind. But there were also hail storms in Colorado and Minnesota, drought and fire in the Plains states, three sizable tornado outbreaks, and flooding in California last February. The National Oceanic and Atmospheric Administration created this insightful graphic detailing the major weather events, many of which may still come as a surprise. In all, there were 16 weather events whose damages exceeded $1 billion.
With that information at hand, and given the realities and the statistics clearly underscoring the risks at stake, we think it is important to think about planning for an unexpected event – especially if you live in an area that could be susceptible to one.
Financial Planning for Natural Disasters
WrapManager’s goal is to help our clients reach their long-term investment and retirement goals, by providing investment advice based on your unique goals and financial situation. We’re by no means experts in disaster preparation, i.e., advising clients on what insurances to own or how to properly assemble an emergency kit. But we can help you do the research based on where you live, and we can help you establish a financial plan of action in the event of an unexpected event or emergency.
The following few suggestions are things that we’ve learned as best practices for being financially prepared in the event of a momentous weather event:
- Take some time to create a folder of photos and videos of your home, inside and out, detailing the valuable items as well as their approximate value and when you purchased them. Having a digital record of receipts is also a good idea.
- If you live in a flood zone, be sure to ensure your federal flood insurance is up-to-date (if applicable) and/or that you’ve explored flood insurance options in the market place. According to the Federal Emergency Management Agency (FEMA), damage from just one inch of water can cost more than $20,000.
- In your “financial planning emergency kit,” which would come with you in the event of evacuation, be sure to include important documents such as your homeowners’ insurance policy, mortgage agreement, wills, deeds, estate plans, health care proxies, and last bank statement, mortgage statement, credit card bill and last year’s tax returns. An alternative would be to have these documents stored in a safety deposit box at your bank and/or available via a digital source and the cloud. Prepare an emergency communications plan. How will you contact your friends and family members if something were to happen where you live? If the power is out how will you check in?
- Besides insurance, which companies would you need to call in the event of an emergency? Is your financial advisor on that list?
Those are just a few ideas, but hopefully they get you thinking about the ways that you can prepare for the unexpected so that you’re able to quickly and confidently respond.
Call WrapManager if you want a sounding board for thinking these plans through, or if you want a partner to help you through the process. We can help you reach the planning milestones you set out to achieve and hopefully leave you feeling a lot more confident about your financial preparedness. You can reach us at 1-800-541-7774 or start the conversation over email at wealth@wrapmanager.com.
