What’s in Your Emergency Financial Preparedness Kit?

What we’ll cover:

• Putting together an Emergency Financial First Aid Kit or EFFAK could help you stay on top of your financial obligations during a disaster or other emergency.
• Here are four basic steps to putting together an EFFAK: Keep some cash on hand, gather your important documents, review them and store your kit in a safe place.
• Hopefully, you’ll never have to use your EFFAK, but if a disaster does strike, you’ll be ready.

Each year, natural disasters like floods, wildfires and hurricanes force people to evacuate their homes. 

If you live in a disaster-prone area, you may already be familiar with emergency “go-bags” – portable kits stocked with food, water and other basic supplies that you and your family may need during an evacuation.

Having a basic survival kit packed and ready to go in a crisis may be obvious, but have you thought about putting together a similar kit for your personal finances? 

An Emergency Financial First Aid Kit (or EFFAK) – as recommended by the Federal Emergency Management Agency – holds important personal identification, medical and financial documents. Having one of these kits could help you stay on top of your financial obligations during a disaster and make it easier to rebuild your life afterwards.

Because everyone’s financial situation is different, what goes into an EFFAK might vary from person to person.

Here are four steps to help you get started in putting together a financial preparedness kit for disasters and other emergencies.

1. Keep cash on hand

Let’s start with the basics. 

As you put together your EFFAK, think about keeping some cash on hand – literally, not just in a savings account. 

These days, many of us are used to paying for things electronically – whether with our ATM cards or smartphones – that we may not think about carrying cash for emergencies.

But if you have to evacuate in a hurry, it helps to have some cash on hand. You never know if banks will be closed or if card payment networks will be impacted.

There’s no hard and fast rule on how much you should have. Consider grabbing enough cash to cover basic needs for you and your family. This means things like food, gas and lodging. 

Remember to keep this money in a safe, accessible location in your house, so you can grab it quickly when you need to go. 

And speaking of emergencies – now is also a good time to remind you to check in on your emergency fund and make sure that it’s in order. Generally speaking, it’s a good idea to have enough to cover at least three to six months of essential expenses. 

While the cash you have on hand could hold you over for a few days to cover basic needs (during an evacuation for example) – an emergency fund can help cover any unexpected expenses that may crop up after you’ve returned home, like insurance deductibles or minor home repairs.

2. Gather and organize important household documents

When it comes to financial preparedness, what documents are considered important? What should you gather first?

FEMA recommends starting with your personal identification documents, followed by any financial and legal papers, medical records and emergency contact numbers.

Trying to find and organize these documents can take some work – but you don’t have to do it all in one day! Putting together an EFFAK may take time. That’s why it helps to start early. 

Here are some examples of documents for each of these categories.

• Personal identification documents. This category is pretty self-explanatory. These documents help to establish who you are and may include documents like your driver’s license, passport, Social Security card, birth certificate (or adoption papers), marriage license and military papers. 
• Financial and legal documents. In an emergency situation, you may need to provide proof of ownership for your assets. So here, we’re talking about records of your financial assets and accounts (and their passwords). This may include titles to your home and car, banking and investment account information, utility bills, tax documents, insurance policies and estate planning papers. 

3. Review and update your documents as necessary

After you’ve gathered all your documents, take a moment to review them to make sure they’re current and accurate.

For instance, do you need to update any of your insurance policies or health records? Make changes to emergency contacts? The last thing you'll want to deal with during an emergency is outdated information, which can add more stress to an already stressful situation.

Going through the checklists and reviewing your documents now can help you identify any information that may be old or missing, so that you can update it ahead of time. 

And remember, this isn’t a one-and-done deal. Once you have your documents in order, consider setting a reminder for yourself to review them regularly (maybe once a year) or during any major life events (marriage, divorce, moving, etc.).

4. Store your documents in a safe place

How you store and safeguard your documents is up to you.

Your EFFAK could be a physical kit – a folder or binder holding your documents. Or it could be a digital kit (say, an external hard drive), where you store electronic copies of the paperwork. 

If you choose to go the electronic route, you may want to make sure that the hard drive and/or copies are encrypted and password-protected. After all, that’s a lot of sensitive information you’re keeping in one place.

Finally, whether your EFFAK is a physical or digital one, you’ll want to keep it in a safe location, such as a fireproof or waterproof box.

Parting thoughts

Knowing what you need to take with you during an emergency evacuation could help you move quickly to get yourself and your loved ones to safety. 

In addition to having a standard emergency kit ready to go, consider putting together an EFFAK, too. An emergency financial kit holding your important financial, legal and medical documents all in one place can come in handy during and after a crisis.

Of course, we hope you’ll never have to use your EFFAK. But if a disaster does strike, you’ll be ready.