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Have you thought about how to get your finances prepared for disaster?

With tax season behind us, now is a great time to think about another important topic that can have a huge impact on our bank accounts: disasters. Let’s consider what steps we can take to protect our finances from unexpected emergencies the upcoming storm season may bring. Below are three important ones.

If you’re currently recovering from a recent disaster, check out the Consumer Financial Protection Bureau’s Post Disaster Toolkit for more financial tips and resources.

Set Aside Emergency Cash

Having cash on hand can make it easier to get basic necessities in the event of an emergency. Power outages or building damages may make it difficult to access banks and ATMs, and stores able to stay open may only be able to accept cash if their credit card processing systems are down.

Think about what your household’s cash needs would be if you had to evacuate for a few days--food, water, gas, hotel, and other basic necessities. Start setting aside what you can afford now, and build up your fund to what you think would cover you and your family for a few days away from home. Remember, small bills are best.

Start a Rainy Day Fund

Having a just-in-case bank account can help carry you through the unexpected expenses an emergency or disaster may bring. Whether it’s repairs to your home or car, or replacing damaged items, the bills after a disaster can add up quickly.

At a minimum, it’s a good idea to make sure you can cover all of your insurance deductibles. Look at all of your insurance policies (homeowners/renters, flood, auto, etc.).

What would you owe in a worst-case scenario if you had to pay all of those deductibles at the same time? What do you need to save to get there? Setting aside even very small amount each week for a rainy day fund adds up over time.

Make Sure You’re Covered

Having good insurance coverage is the best thing you can do to protect your household finances from disaster. Federal assistance is limited. FEMA disaster assistance grants are available only when a federal disaster declaration has been issued, and the maximum grant a household can currently receive is $34K; most households receive much less than the maximum. In contrast, insurance pays out any time you have a qualifying loss. For comparison in flooding events--the most common disaster we face in the US--the FEMA grant average is $4.6K vs. flood insurance claim payout average of $43K.

Whether you’re a homeowner or renter, you want to make sure you have sufficient coverage for all of your property AND for all of the perils you may face, especially flooding. To be covered for any flood-caused losses, you have to purchase a separate flood insurance policy--flooding is not covered by your homeowners or renters insurance policy. Flood insurance also has a 30-day waiting period before coverage goes into effect, so you don’t want to wait until there’s a major storm in the forecast to consider getting covered.

Check out SBP’s Preparedness Checklist for a list of questions you can talk through with your insurance agent to help make sure you’re covered well. And remember to make sure you have a good home inventory too!