Organize and Protect Financial Records Before Disaster Strikes: Five Steps to Take Now

Organize and Protect Financial Records Before Disaster Strikes: Five Steps to Take Now

By Scott White, CFP®, ChFC, CLU

The best way to ensure the most positive outcomes in a disaster is to prepare ahead of time. If a natural disaster strikes and you are in the evacuation area, can you be ready in 20 minutes or less? If an accident happens in your home, do you have a plan? Protecting financial records may not be the first thing that comes to mind when you think about a disaster. But after your loved ones are safe, you’ll need access to documentation.

Keeping records safe and accessible by creating a fire-safe, water-safe, and easily transportable option will make a traumatic evacuation or disaster recovery process easier for you and your loved ones. These days we don’t have paper copies of all our documentation, so we recommend a combination of digital and hard copy documentation.

Step 1 – Create a Storage Box

Within your evacuation or disaster relief plans you should also include a financial box that includes important documents, photos and a few days of cash or traveler’s checks. You will need both a digital and physical box. For your physical documentation, it is best to find a lockable, fire-safe box for these documents that will protect the contents in case of fire or flooding. Make sure to keep the combination to the box, or the key, on you at all times and place a duplicate in a safe place, or with a trusted person.

If you keep financial records, passwords, family photos, and videos on a computer, using a cloud service to regularly back up this data is highly recommended.

Step 2 – Gather Important Items

Gather physical documents and place in your fire-safe box. Digital documents should be organized in a folder online in your cloud storage. Necessary documents include the following items:

-> Checking and savings account numbers as well as online access or website address and logins.

-> Copies of documents for you and your family members:

  • Driver’s license(s)
  • Passports
  • Social Security card(s)
  • Marriage license/Divorce papers
  • Birth certificate(s)
  • Will(s)
  • Power of attorney
  • Property deeds
  • Vehicle registrations

-> All investment and retirement account numbers

-> Home, life and medical insurance policies

-> A list of crucial contact information on your phone. Whether this is a digital document, or you merely label these contacts in your phone contact list, make sure you and your loved ones know where to find the information.

  • Insurance agent(s)
  • Attorney
  • Bank
  • Financial advisor
  • Family, friends or other key people you may need to reach in an emergency
  • Trusted home repair contractors

Step 3 – Review Your Coverage

Do you have the proper insurance coverage if disaster strikes your family? Review your current home, life, and medical insurance policies to ensure you and your family will be comfortable and cared for in the event of an emergency.

Step 4 – Ensure Access to Emergency Funds

Natural disasters often interrupt access to local banking and financial institutions. Make sure you have an emergency account that can provide access to emergency funds within 24 hours or less. It is also advisable to keep cash or other accessible funds on hand in a disaster box in the event internet and electricity is interrupted.

Step 5 – Share the Information

Review your document information and location with your spouse or partner and determine together where the box will be stored as well as any access information. Also contact a trusted family member or friend outside of your household and share the document box location in case something should happen to you.

While none of us likes to think about disasters, preparing now will ease any recovery efforts necessary after a traumatic event.

The opinions expressed are those of the author and not necessarily those of Raymond James.