Financially Preparing For A Natural Disaster

Last week, I was talking about debt and domestic abuse, this week I’m talking about preparing for natural and unnatural disasters…

You’re probably like “Um, this is getting kinda heavy, Michelle. I’d just like to know how to prepare for my retirement…”

Um, hello! Climate change! You won’t BE retiring!

Juuust kidding.

My answer to that is to get comfortable knowing how much money you spend every month and save as much as you can comfortably afford. That is all. There ain’t no magic formula.

Keep your investments super diverse (i.e. several funds, not individual stocks), use this quiz to determine how your portfolio should be invested, and have a representative at the company that manages your investments make sure you’re allocated accordingly.

Okay, back to the apocalypse!

 


 

Actually, since we’re on the topic of investing, let me talk about how meteorologists are a lot like financial analysts.

A week before Irma was scheduled to make landfall in my town, I texted my meteorologist neighbor for insider insights into Hurricane Irma. She kept responding with “model runs” (whatever TF those are) when I just wanted to know if we were going to be okay.

I didn’t want a “maybe” – I wanted a definitive answer. I saw the range of potential paths of destruction but I didn’t care about what COULD happen. I wanted to know what WOULD happen.

So I asked “Well, what are YOU doing to prepare?” and she responded with a photo of an alcoholic drink called a hurricane. It was like a Capri Sun for adult but I don’t drink. Very frustrating.

Then, I realized: Wait, this is me. This is how I respond when people ask me for financial tips, how much to save, is this a bubble or is this sustainable growth? But the markets are just as volatile as the weather. (There’s a parallel to be drawn in there about bubbles and climate change I’m sure.)

Financial analysts are a lot like meteorologists. Very few people have any idea what the heck they’re talking about and it’s cool because we have zero accountability as long as we give you a range of possibilities. We rarely have to be right.

So I prepared for the hurricane like I would a financial disaster: Stocking up just enough that there’s a balance between hoarding and living beyond my means. I bought canned goods I would actually eat in the next 2 weeks, withdrew some cash to keep in my waterproof safe, topped off my gas tank etc.

There are no definitives when it comes to weather and finance, so I left my non-psychic meteorologist neighbor alone and did my best to prepare sensibly because panic during a natural disaster is just as destructive as during a financial one.

And if anyone ever tells you that they have that magic investing tip, they’re either guilty of insider trading or full of shit. And if they say “Well, historically, it’s done THIS” it could still very much do THAT. (Remember mortgages 10 years ago?)

So yeah, earlier this week, I survived Hurricane Irma. I had too much time to prepare and Harvey was fresh on all our minds, and then the storm veered west at the last minute and my town was spared the brunt of the damage (even though my meteorologist neighbor insisted we were in the worst quadrant I rest my case).

 


 

I was in NY for Hurricane Sandy which was rather traumatic: a hurricane and a blizzard in the same week, gas shortages, no power, no cell service, no heat. So when the water disappeared from the shelves here and gas lines started to form, I’m surprised I was able to keep myself from financing an RV and skipping town. Mindfulness at its finest I suppose.

I am both embarrassed and proud to admit that, in the past, I have used my urge for retail therapy to stock up on emergency supplies so I had enough to keep me afloat. I still got swept up in the doomsday prep frenzy but I just bought a few extra cans of green beans and bags of potato chips and a $10 doggie life vest that was the greatest bargain I got all year.

I was feeding 6 people for 3 days because my grandparents’ idea of hurricane prep was to buy a case of ginger ale and seventeen loaves of gluten so my grocery budget was annihilated. My entertainment for the rest of the month will be the Fandango gift card in my wallet assuming the movie theatre has power.

But really, everything could have been so so so so much worse and I am very grateful to be writing to you today with my cell phone data.

Side note: Want to be more productive? Use your cellular data for wireless when you lose power and internet and quickly bang out emails. Want to be less productive? Get a text from your wireless provider that they’re waiving data overage fees for hurricane victims. This email could have gone out yesterday if I didn’t read so many What Happened book reviews.

 


 

Mother Nature seems a bit reckless right now. I’ll be honest and admit I’ve thought the thought “What’s the point in saving and conserving if this is the apocalypse?” several times over the past couple weeks.

Natural disasters don’t seem to be letting up anytime soon so we need to find ways to weather the storm, both literally and figuratively.

Does this mean investing in a bunker and survivalist supplies? Well, I’ve certainly considered it. There are reports of Miami disappearing in my lifetime. Why TF did I choose Florida? (Well, having lived through Sandy in New York, I do consider Florida more prepared for natural disasters than other places and my experience during Irma seems about right.)

The only way we can prepare really is to get comfortable with discomfort and find some happy medium between being careless and careful; not living in total fear, but being cautious and mindful as we enjoy ourselves.

Also, there’s no shortage of articles about how economic factors impact one’s ability to flourish after a natural disaster: means to evacuate without having to stay in a shelter, having enough money to not fall behind on your bills if you have to miss a few days (or weeks… or months) of work, access to safe and sustainably planned neighborhoods, etc.

Getting your money right is an essential survival strategy and I don’t say that lightly.

 


 

So how do you prepare?

Keep cash on hand

I have a hot pink waterproof safe that I keep about $300 to $500. It fluctuates because I dip into this when I’m too lazy to go to the ATM. If the electricity goes out, credit and debit cards don’t work. Although a lot of stores around me are still closed because they don’t have internet and they’re not even taking cash… Oh well.

Buy supplies well before the storm

I prefer my Brita pitcher to bottled water but somehow I managed to have a case of water on hand for when I have guests who come without a reusable water bottle. This was great because the stores were out of water 10 days before the storm hit. A lot of the survivalist supplies I was eyeing on Amazon would sell out in my cart as well. My childhood pediatrician told my parents to have a bunch of emergency medications on hand because “If you have ‘em, you’ll never need ‘em.” This is a superstition that’s a win-win.

Keep your records safe

Scan your records into a secure cloud drive like Dropbox or Google so they’re easily accessible on the go. It also helps to keep paper copies in a waterproof/fireproof safe or safe deposit box. The day before the storm, I was frantically scanning my dogs’ most recent immunization records that have been sitting on my desk for the past 2 months.

Get insured

Whether you own or rent, insure your belongings! Insurance is relatively cheap compared to what it costs to replace everything in the grand scheme of things. And yes, I was totally re-checking my coverage a few days before the storm and saved a copy of my policy to my cloud drive for easy access.

Save as much as you can

This applies always all the time every day: If you can comfortably save, save it. There are still deductibles and waiting periods when it comes to insurance and disaster relief. Having funds to lay out for the clean up is one less thing to worry about. Build up that emergency savings account while you can.

Automate your bill payments

Ain’t nobody got the headspace to remember to pay bills in the aftermath of a natural disaster! If you automate your banking transactions, you can focus on putting your life back together afterwards rather than searching for your checkbook or a decent internet connection.

I wish you safety and calm in these crazy times. And if you are a struggling after Harvey or Irma and there’s any way I can help, please don’t hesitate to message me!

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