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Sheltering Your Personal Finances in a Natural Disaster

Shocking images of hunger, poverty, and chaos have made many of us acutely aware of how a natural disaster can make life as a survivor seem less appealing than the alternative. There are many ways to prepare for the unthinkable, but one of the most frequently overlooked steps is financial preparedness. Consumers with existing debt management issues are at higher risk for financial losses during natural disasters. But creating a simple plan ahead of time, that prevents debt from becoming the next disaster, will ensure that your finances remain steady during a difficult recovery period.

"For people who are living paycheck to paycheck, an unexpected emergency or natural disaster can be all it takes to push them over the edge," says Chris Honenberger, President and CEO for ClearPoint Credit Counseling Solutions, a consumer credit counseling service. "Our counselors work with disaster victims to help them recover from debt management issues, and to prevent them from occurring in the future."

The key to a smooth recovery is preparing beforehand. Residents in disaster-prone areas stock emergency food and water. This same advance thinking applies to finances.

  • Store important documents in a portable, durable and fireproof file box. Make sure to include: copy of driver's license, Social Security card, proof of residence, insurance policies, wills, deeds, birth and marriage certificates, tax records, and photos and descriptions of larger valuables. In the event of an evacuation, take the box with you.
  • Set aside savings now for an emergency fund. Building a savings plan into your budget creates financial reserves to help you get back on your feet when facing any emergency. Working with a consumer credit counseling service can help you create a realistic plan for managing debt and building savings, no matter what your income level.
  • Make sure to have current flood, earthquake, fire, tornado and hurricane insurance coverage on your home in place.
  • Create a disaster contact list for your emergency box (see below): include your insurance companies, creditors, mortgage company, etc.
  • When disaster progresses to recovery, take steps to regain and maintain your financial stability. (Tip: Print this list to store in the box with your important papers).
  • Only give out your Social Security number to verified agencies that can provide assistance.
  • Regularly monitor your credit report, which a consumer credit counseling service can help evaluate, to safeguard against identify theft. Access it for free at www.annualcreditreport.com.
  • Check with your bank to ensure accurate account activity, to update your information, and for a supply of checks.
  • To maintain effective credit management, contact creditors as soon as possible to have statements forwarded to your new or temporary address. Creditors will sometimes make concessions for victims who are forced to relocate, and include a "disaster victim" note on your credit file.
  • If your circumstances do not improve before creditor concessions end, contact creditors again to discuss appropriate debt management based on your individual hardship. Consumer credit counseling services can help negotiate with your creditors.
  • Ask your employers if there is an Employee Assistance Program and access any helpful resources its representative can provide.
  • Notify your state's employment commission of your employment status and ask out about special job considerations for disaster victims.

Register with the Social Security Administration for victim benefits.

The consumer credit counselors at ClearPoint Credit Counseling Solutions can offer sound financial advice if you have been displaced due to a natural disaster or other emergency situation. Call (877) 877-1995 and ask about our consumer credit counseling services and receive free one-on-one advice on how to resolve credit and debt management issues today.


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If a DMP is right for you, you will learn to successfully reduce your debt through:

  • Financial review
  • Budget analysis
  • Action plan
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