Preparing Financially for Disasters Often Overlooked

Tips to Help Storm Victims Recover from Financial Loss

Date: May 25, 2011

Contact: Paul Golden 303-224-3514, [email protected]

DENVER—This weekend’s tornado that ripped through the tiny town of Joplin, Mo., preceded by the storms that wreaked havoc throughout the south early in this 2011 storm season, are difficult reminders that disaster can strike anytime, anywhere.

"Disasters obviously take an emotional toll, causing shock, grief and confusion. And the sudden shock to your financial system can be severe," says Ted Beck, president and CEO of the National Endowment for Financial Education. "Following a disaster you may feel panicked or helpless. But it’s important to stay calm, ask for help and exhaust all resources offered to you as a victim."

NEFE offers these tips to financial issues that disaster victims must address immediately.

Housing and Property

If you are leaving your home or are being asked to evacuate the area, be sure to collect your important financial documents along with your valuables. You will need them to file insurance claims, pay bills and take care of family members. Important documents include, but are not limited to: legal certificates, wills, powers of attorney, insurance policies, Social Security cards, your checkbook and bank account information, among others.

Finding Help

The following are a few of the agencies and organizations that provide assistance to people affected by a disaster:

  • FEMA:  If you live in a county declared a major disaster area by the president, you might qualify for additional assistance and tax relief. Contact the Federal Emergency Management Agency at 800-621-3362 or go to
  • Red Cross:  Call your local Red Cross chapter or go to
  • Salvation Army:  Contact your local Salvation Army or visit
  • Volunteers of America:  Find a local office by calling 800-899-0089, or go to
  • National Voluntary Organizations Active in Disasters:  This website lists other national and state organizations that can help. Go to
  • State and county offices of emergency preparedness:  Look in the blue pages (government section) of your local telephone book.

As soon as you can, contact your insurance company to notify it of your situation. Ask if your provider will pay for temporary living expenses if you are forced out of your home. If this provision is not included with your insurance policy, contact the Red Cross for crisis shelter locations and information.

Money and Cash Flow

Do you have enough cash on hand for emergency needs should banks and ATMs also be affected by the disaster? If not, contact the Red Cross or the Federal Emergency Management Agency (FEMA). One of these organizations might be able to guide you to sources of emergency cash assistance. You also might contact your employer and request an advance on your next paycheck.

This is a good time to contact your creditors to explain your situation. As always, paying your bills on time protects your credit rating. But, considering the circumstance, your creditors might be willing to work with you on a delayed payment schedule if necessary. Be sure to prioritize your bills, keeping in mind that insurance policies and mortgage or rent payments are the top priority. You also might consider stopping some bills immediately. For example, you can contact your utility, telephone and cable providers to halt services on the property you have vacated. Before canceling the service though, make sure you ask about termination and reconnection charges.


If you foresee missing time away from work, be sure to contact your employer immediately. If you or a family member is injured, you need to begin the process of applying for any available employee-sponsored disability benefits.

You also may be able to take advantage of the Family Medical and Leave Act if you are unable to return to work in the near future because you are caring for an injured family member. This law applies to companies with more than 50 employees. Learn more by visiting the U.S. Department of Labor’s website at or by calling 866-487-9243.

"Once you know your family is safe, action in these areas is critical to shorten the duration of the financial disruption," says Beck.

When the disaster subsides, there will be time to regain control of your routine, your financial security and your life. But the process will take time. For more on what steps to take in the coming weeks and months, visit Disaster Recovery: A Guide to Financial Issues for information and resources on getting reestablished. NEFE has partnered with the Red Cross and the American Institute of Certified Public Accountants (AICPA) to produce this booklet.

For more tips on financially preparing for an impending disaster, NEFE and the American Red Cross offer Disasters and Financial Planning: A Guide for Preparedness on Smart About Money (



  • Paul Golden

    Media Relations Director

    Direct: 303-224-3514
    Cell: 303-918-3620
    [email protected]