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I
am writing this newsletter on Friday evening, a full day before
Hurricane Irene is scheduled to hit New York. I hope that when
this finds you it is business as usual and that everyone is healthy
and damage free! Unfortunately, this lesson is coming to you after
the storm, which will not help those who have already been hit hard.
But it will hopefully help everyone prepare for natural disasters in
the future. (It sure seems that there a lot of them these days!)
All of us on the
east coast are not used to earthquakes and category two or three
hurricanes, but we must come to terms with the fact that they are
occurring. It is hard enough to try to prepare our homes,
property, and physical possessions, let alone thinking of our credit
and finances as well. Here is what can happen if we do not
prepare in advance:
We are in our
home and the storm hits. The winds are shooting by at 80 miles per
hour, and a tree is flailing back and forth. Suddenly it flies
up in the air drops back down taking a telephone wire with it as it
lands on top of our home. The tree crushes down and opens up the roof
practically splitting the house in half. The rain is pouring in and
we have to evacuate immediately since it is too dangerous to remain
in the house. We grab our nearest necessities and leave the house to
stay with a relative or go to a shelter.
When the storm
finally passes, the house is in shambles and we now have to arrange
to stay in a hotel and figure out how to sort out this mess while
dealing with the havoc this has caused in our daily lives. This is an
extreme example, but weather can be unpredictable, and we must
prepare for the worst.
Here are some
tips that will ease the burden and give us just a couple fewer things
to worry about:
1.
Make a list of all your creditors including credit cards, mortgages,
other loans (education), and car payments.
a. Creditor
name
b. Account
number
c. Creditor toll
free phone number
Keep the list in
your cell phone if it is password protected and can be kept in an encrypted
file. If not, keep the list in your cell phone but remove the
account numbers. The creditor will be able to find the account with
your social security number if necessary. It is also a good idea
to keep a copy of the list in a file that is safe in your email
account in the event that you lose your phone. You will have
access to your email account from any computer, and the information
will be safe in the cloud, so to speak.
Be sure to list
all the automatic withdrawals you have on any of these accounts such
as EZ pass, health insurance, etc. This will help if you have to
cancel an account; you will know exactly who you have to contact to
supply the new credit card information.
While you are
making this list, check to see when the expiration dates on your
cards are coming due. If they are right around the corner be aware
you will have to be on the lookout for a new card and then you may
have to update the automatic debit creditors. It is a good precaution
to do this in advance of an upcoming disaster.
2. Try
to set up all of your payments online automatically for the next
three months.
If there is a
disaster and you suffer a lot of damage, you will have enough on your
mind to worry about and manage. Knowing that your payments to
creditors are all taken care of will help ease the burden. Be sure to
write down the transaction confirmation of the online setup on the
list of credit cards, in the event that there are any problems with
the payments in the future. Missing a payment because the scheduled
transaction was not completed will only add insult to injury.
3. Do
not max out your credit cards.
Be sure to have
low balances on your credit cards in case there is an emergency and
you need access to funds that are larger than usual. If you need car
services, hotel stay, or even cash from the ATM, this tip will be
crucial. It is possible you may not have access to cash at all
if there is a disaster and your credit cards may become even more
important.
4. For
security purposes, be sure to completely log out of any public
computers before allowing others to use that computer.
Though we hope
none of us will ever need these tips, it is always good to be
prepared, especially since good credit is so important in our daily
lives and the damage done to your credit by a natural disaster can be
felt long after the physical damage is repaired.
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