If you are reading this then it might have been a month since you experienced a major life disaster. Maybe it was a natural disaster like a flood, earthquake, or big storm.
A lot has surely happened in the last month. Maybe you are back in your home, it’s badly damaged, or it was destroyed.
I’m assuming though that if you are reading this that your financial life has taken a real kick in the gut and there is still a lot broken in your life.
Don’t worry, with a good plan we can work through the financial mess and recover from that later. Right now there are more pressing issues to deal with.
The first thing I need for you to do is make sure you still know where all your important documents are. Here is the list I gave you to gather before your evacuation.
Make sure you keep those items safe and accessible.
Cash and Spending Money
If you’ve been displaced and not able to get a full paycheck I would imagine your cash reserves are starting to run low. Hopefully you’ve already sought out benefit programs to help disaster victims and you are on the waiting list for benefits.
Every dollar in benefits you receive slows the cash loss and buys you more time.
If you need to know what government benefit programs are available, click here.
You still need to guard your remaining cash like it’s gold and try to avoid spending it unless you absolutely must.
In previous guides I advised you to put all your expenses on your credit cards and run that debt up to protect your cash on hand. We’ll deal with the debt once you are safe, warm, secure, and back on track after the disaster.
Having high balances may lead you to fall behind on your credit card payments but getting your life stabilized at the moment is the most important thing we can focus on right now.
When things get back to a new normal and you have income coming in again, then we can tackle the debt.
Stay in Touch With Your Creditors
Keeping your creditors posted on your current status following a disaster displacement can keep you in their fair graces and determine if you are eligible for any temporary payment holiday.
Sometimes following a disaster, creditors will give people a 90 day payment holiday to regroup. It also makes the creditor look like they are caring and sensitive. On some level these temporary payment holidays are a public relations stunt but you might as well get the most benefit out of it that you can.
When you call and check-in with your creditors, ask them to put a note on your account that you called with an update.
Previously I suggested that you put your mail on hold. If you can swing by and pickup your mail, go to your local post office and do it. If you are displaced we don’t want the post office delivering a months worth of mail to your empty house. And a hold on mail is usually only good for 30 days.
When you go to the post office, and you still need for them to hold your mail for a longer period of time, ask them what options are available.
Your cash may be limited at this point so we need to prioritize what payments need to be made first. Since you will need your car or truck for transportation, that’s at the top of the list along with your car insurance. Next is health insurance, life insurance, and home insurance. If your home was damaged we especially don’t want any break in coverage till it is determined what the insurance company is going to do about your claim.
Pay your cell phone bill next. You will need to maintain your communications with the outside world to help get your life back together.
If your home is still habitable or can be repaired, make your mortgage payment. If the house it totaled then talk to your insurance company about how they will handle your loss. Maybe they will payoff your mortgage and give you some additional cash for lost goods.
We need a good idea how your specific insurance company is going to handle paying on your claim before we know exactly what to do about the mortgage payment.
The lowest priority bills will be the credit card statements. If you can’t pay them when they are due then your account will fall past due and you’ll start getting collection calls. After a month it will begin to be reflected on your credit report. Don’t worry about that. It is what it is. You’ve just been through a major life disaster aand sometimes a lot of things get jumbled. We’ll deal with the broken credit and credit history once your income resumes or is replaced.
Nothing is really going to happen at this point. Be nice to the collectors when they call and don’t make any promise to pay that you can’t either afford or honor.
As long as you don’t let the collectors intimidate you when they call you can just let your delinquent account flow through the natural collection process. That will buy you some time. And if you try to keep a positive attitude with the collectors it will buy you less stress in dealing with them.
Income, Income, Income
Even this early in the recovery process you need to start thinking about how to replace your potentially lost or reduced income. Without income it will become much tougher to recover.
Your old employer may be out of business because of the disaster or you might be having a tough time getting to work. Whatever, we need to focus on solving this problem first.