Working Through the Financial Impact of Natural Disasters

  • September 20, 2021
  • By: Greenpath Financial Wellness

Since 1980, the U.S. has sustained 285 weather and climate disasters where overall damages costs totaled or exceeded $1 billion. Nearly one in three Americans experienced a weather disaster since June 2021.

As residents in the Southeast and on the East Coast are being ravaged by the impact and aftereffects of Hurricane Ida, those in the West continue to battle wildfires, intense heat and drought.

Many households across the country have suffered personal loss as a result of the recent weather and climate events. So many families have acted urgently to ensure their safety and wellbeing, recover treasured possessions and must survive difficult living conditions.

Proactively managing your finances when a natural disaster occurs can help reduce stress induced by the unexpected event and mitigate long-term damage to your finances.

If you are facing an unexpected natural event or the continued challenges of ongoing national emergencies, coupled with the recent end of federal unemployment benefits, here are tips to manage the financial impact of natural disasters and mitigate the financial stress these events can cause.

  • Use cash and emergency funds to take care of immediate, essential needs – medicine, food/water, heat/electricity and housing. Utilize Child Tax Credit funds, other forms of COVID relief, loyalty and credit card rewards to cover expenses.
  • Contact disasterassistance.gov, local and state agencies as well as nonprofit organizations for assistance. Federal Emergency Management Agency (FEMA), American Red Cross, United Way, Salvation Army, Veteran Affairs and local food banks may provide needed services.
  • Be extra careful. Watch out for scams and fraud, which are an unfortunate part of disaster recovery.
  • If you haven’t already, contact your insurance companies to file a claim as you as you can. Whether it’s auto, home, fire or flood damage, your insurance company will help you take the necessary steps to make a claim. Use your smartphone to take photos and video of any damage and save the photos to a cloud-based account, so that you can make an inventory and prove damage. The sooner your file, the better – as insurers will face a significant number of claims.
  • Contact your landlord, credit card and mortgage companies, and other creditors to request hardship assistance. If the disaster, such as a catastrophic weather event, fire, or even an ongoing pandemic, affects your ability to make debt or housing payments on time, your creditors may offer forbearance, payment deferral, payment plans or waived fees. GreenPath counselors can join the call with your loan servicers and help you sort out the terms.
  • Call your utility companies immediately, if you cannot live in your home due to damage. Utilities can put a stop hold on billing if you are not living in the home or not receiving utility services. By connecting with utility companies, you can ask about available relief programs and hardship assistance.

1. If you haven’t already, contact your insurance companies to file a claim. Whether it’s auto, home, fire or flood damage, your insurance company will help you take the necessary steps to make a claim. Don’t forget to take photos of any damage – use your smartphone and save the photos to a cloud-based account. This will help you make an inventory and prove damage.

2. Contact your credit card and mortgage companies, and other creditors. If the disaster, such as a catastrophic weather event, fire, or even an ongoing pandemic,  affects your ability to make debt or housing payments on time, your creditors may waive late fees or even allow a deferred payment. GreenPath Financial Wellness is available to help you communicate with your creditors or lenders and can offer additional financial guidance.  Start with a free consultation from someone who has your interests at heart

3. Check your credit report. Go to annualcreditreport.com for a free copy of your credit report. If you notice that late payments have affected your score, you can add a short statement to your report explaining your situation. You still may see some impact on your credit report, but it can help with future lenders.

4. If you can’t live in your home due to damage, call your utility companies. It’s better to reach out to your utility companies as soon as you can. Utilities can put a stop to your bills if you are not living in the home or not receiving utility services. Connecting with utility companies lets you understand any options or relief programs that may make available.

5. Look into other special programs that may offer assistance. For example, you may be eligible for veteran benefits, or assistance from FEMA or the American Red Cross. Other government and debt relief options are available due to COVID.

6. Talk to us!  Remember you are not alone.  Our NFCC-certified counselors help you begin a conversation about where you are today as you manage through the emergency, and what you need to accomplish your goals. We guide you through a process to assess your financial situation, understand your specific challenges, and create an action plan to work through them.

We Are Here for You

Having a national nonprofit resource like GreenPath is critical during a time of challenge. We listen with respect, offer advice and information, and suggest options that could help you meet your needs.