Christian Financial Planning, Budgeting & Investing

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How to Protect Yourself from a Financial Emergency

How to Protect Yourself from a Financial Emergency

Dear Deborah,

What can I do to prepare for the financial impact of electrical power outages? During the past year I’ve become more aware how severe storms like snowstorms, rainstorms (causing flooding) and hurricanes cause power grid outages for weeks. Since we are becoming more of a cashless society, how can I prepare when we have power disruptions? A Concerned Reader

We’ve seen recently how severe weather can create power outages for weeks at a time. It causes major disruptions for people dependent on uninterrupted power usage.

To be more ready for these unpleasant realities, here are two important things we can do:

1. Have adequate cash on hand.

Withdraw in cash at least two weeks’ spending money, in case the ATMs were temporarily inaccessible.

If power grids are down for a considerable length of time, affecting multiple systems, this would affect financial services and banking transfers.

ATM cards, debit or credit cards could stop working. Banks could remain closed for an undetermined amount of time. It’s important to have cash that’s accessible.

2. Keep paper records of online payments.

To minimize the negative impact of major disruptions in telecommunications, keep paper records of payments made. Be able to prove you’ve made payments.

There are growing numbers of people making regular payments online. These include mortgage, car, and utility payments. Have hard copies of invoices or statements showing proof of payment.

Keep records of recent statements of bank balances and investments for proof of ownership.


Dear Deborah,

I’ve figured out that although homeowner’s and auto insurance policies are necessary, they are not inexpensive. What are some ways that I can keep the cost of insurance down? –Alex

There are several ways to help reduce the costs.

1. Increase your deductible. If you opt for the highest deductible you can afford, this will lower the premiums you’ll need to pay. Be sure to have the savings set aside to cover the deductible, if needed.

2. Combine policies. If one company provides several insurance products, ask about discounts available for combined policies. Typically, by combining policies, insurance costs are lowered.  

3. Have a good credit history. In general, a better credit history lowers your insurance premium. Insurance providers will consider your credit history when determining how likely you are to file a claim.

4. Ask about discounts. When getting auto insurance, ask about discounts for factors such as good grades, passing a driver safety course, and driving a car with antilock brakes. This writer knows from experience that these discounts add up over time.

5. Shop around. Compare what different insurance providers have to offer. Choose the best insurance provider for you and your needs.

©Deborah Nayrocker. All rights reserved. Permission to reprint required.

Deborah Nayrocker writes on personal money management topics, showing others how to take control of their financial future. Deborah is the author of The Art of Debt-Free Living and Living a Balanced Financial Life.

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