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4 Ways to Fortify Your Finances Against Natural Disaster | Personal Finance

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An alternative if you’re a renter or otherwise can’t qualify for a HELOC is to ask your bank for a personal line of credit. Credit cards can also help pay the bills if there’s enough available credit. Once you have $500 or so set aside for emergencies, consider paying down your credit cards and aim to use no more than 30% of your credit limits. Using even less of your credit limits would be even better, because it frees up more space on your cards and also helps to build or maintain your credit scores.

Try to cover the big risks

Check your home’s susceptibility to various disasters at freehomerisk.com, a database created by HazardHub, which supplies risk data to insurance companies. Each hazard your property might face is graded from A to F. The lower the grade, the more you should consider ways to mitigate the risk if you can, says HazardHub co-founder Bob Frady.

That could mean buying additional coverage. A typical homeowners or renters policy doesn’t cover damage from floods or earthquakes, for example, but such coverage can be purchased separately.

Review your policy to see what’s covered and what’s not. Make sure you have replacement coverage for your possessions rather than actual cash value coverage, which pays considerably less. You’ll also want at least 24 months of loss-of-use coverage, which pays for your living expenses while your home is rebuilt, Bach says. Widespread disasters can cause even longer rebuilding times.



Read More: 4 Ways to Fortify Your Finances Against Natural Disaster | Personal Finance

2021-10-14 11:00:28

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