Preparedness eases stress when the unexpected strikes

A few weeks ago, I awoke at 5 a.m. to a peculiar humming sound. I trundled out of bed to investigate, but I already knew that something was amiss. The sound was caused by a problem with our water system; our cistern wasn’t filling, and we had no water.

While I waited for a reasonable hour to call for help, I contemplated making my morning coffee. Without running water, the small carafe of water in the refrigerator became precious, and so did the notion of being able to flush the toilet.

Thankfully, I had a couple of five-gallon containers of water stored in our crawlspace. They became necessary for preparing meals and for priming our pump when the water was finally restored. Being without water for half a day was a minor inconvenience, but having a source on hand eased the frustration of not being able to use the faucet.

The situation reminded me how important it is to be prepared for the unexpected. Preparedness isn’t needless worry or frenzied stockpiling; it acknowledges that disruptions in normal services can and do happen. A little bit of advanced planning can reduce the stress and discomfort of these disruptions and can make it easier to cope with unusual circumstances.

When you make preparedness a habit, instead of a reaction to bad news, you can make sensible choices that can protect you in case of a disaster. You can also keep your budget intact when you gather supplies over time, and when they are readily available.

The most successful way to build a preparedness plan is to start with a few small goals. I suggest you start by creating a simple communication plan. Knowing the answers to a few key questions can help you make contact with your family following a disaster.

In the event that you cannot contact your family after a disaster, have a plan in place to meet at a specific location. Where will you meet if you cannot go home? Who will pick up the kids if you are faced with an emergency? If your children are old enough to be left alone, what should they do if they are separated from you?

Once you have a plan to ensure you know how to find one another, a good second step for preparedness is to create a financial binder. By gathering your most important personal and financial documents, you have a set of data that can help you restore order following a disaster.

Next, consider how you will ensure that you have enough food and water if you aren’t able to get to a store or if supply chains are disrupted. The Federal Emergency Management Agency (FEMA) advises that individuals and families should have enough food and water to last a minimum of 72 hours.

FEMA recommends that you store at least one gallon of water per person per day. For our family of six, this means that we should have 18 gallons of potable water on hand. As for food, what you store will depend on your family size and any specialized needs you may have. If you have an infant, or any dietary restrictions, then you should plan accordingly. If you have pets, they will need food and water, as well.

A well-stocked first aid kit, flashlights and batteries, a basic toolkit, a hand-crank radio, and weather-appropriate clothing for everyone in your household are other essentials you should have readily available.

Disasters and disruptions are never easy, but being prepared can relieve some stress until life returns to normal.

A financial binder can help you cope with disaster

When I took our computer to be repaired last week, the technician confirmed my suspicions: the hard drive had gone caput. Thankfully, I’d sensed trouble, and was able to copy five year’s worth of pictures (and some important documents) before it stopped working completely.

Having our computer crash was a poignant reminder that technology can (and will) fail. It was also the motivation we needed to start working on one of our family goals for this year, which is to create a financial binder.

Although we have a fairly complete and comprehensive filing system, our documents are spread out in several places right now. With a financial binder, we will gain quick, easy access to our personal and financial information in the case of an emergency. Faced with a natural disaster, a fire or an unexpected death in the family, we will have the information we need to manage our financial affairs.

Though computers and other electronic devices can store and manage a tremendous amount of data, paperwork will truly be the key to disaster recovery. Our plan for pulling that paperwork together is simple. We’ll get a few inexpensive supplies—a large, three-ring binder and a few colored dividers—and spend a couple of hours making copies and assembling our information.

The first section in our binder will be labeled “Identity.” In it, we’ll include copies of each family member’s Social Security card and birth certificate, immunization records, and copies of our marriage license and driver’s licenses. In addition, we’ll make a list of people to contact in an emergency, including business, medical, religious and professional contacts.

Next, we’ll gather our financial records. The “Financial Records” section will include information about our checking and savings accounts, installment loans and credit card accounts. Social Security benefit statements, retirement account information, wills, life insurance, and tax and trust information will also go into this section.

A “Home” section in our binder will include copies of our home insurance policy, our mortgage, and an inventory of our personal property. Information about our vehicles, including titles and insurance policies, will be filed here, too.

Finally, we’ll include a section for “Medical” information, where we’ll make copies of our health, vision, and dental insurance cards and policies. If you take prescription medication or have other special medical needs, include that information here, too. For example, one of our children has a life-threatening food allergy. We’ll add the contact information for his allergist and include copies of his allergy tests, which detail the foods he must avoid.

While you’re gathering the information you need to file your taxes, you might want to copy your important documents and start your own financial binder. You can create it using the system I describe, or you can go online to find more detailed instructions about how to pull together your personal data. You can even buy complete kits that come with preprinted labels and contact sheets – although nothing that formal or expensive is necessary to create a financial binder.

When you’ve completed your financial binder, store it in a secure place, such as a safe deposit box or a fireproof safe. You need to tell a trusted family member or friend where to find the binder, and be sure to review the information once a year or when you’ve experienced a significant life change, such as a marriage, divorce, death, or relocation.

It will probably take a few hours to assemble your financial binder, but the time you spend now gathering these documents can help ease the stress and uncertainty if you need this information in an emergency or a disaster.

Secondhand shopping yields practical, beautiful finds at bargain prices

A few weeks ago, I admitted that thrift and secondhand stores can be a serious point of budget vulnerability for me—my Achilles heel. Still, in making such a declaration, I didn’t explain why my family shops at these stores in the first place. When I shop carefully, I can use the money we save to fund our family’s goals, such as buying a new vacuum cleaner that can handle pet hair and the volume of dirt brought indoors by our four children.
Whenever possible, we scour secondhand stores for things we need. We dress our children (and ourselves) almost entirely in secondhand finds. We buy nearly all our winter gear, such as coats, snow pants, and boots at thrift stores. And we buy virtually all of our household goods as seconds too, including kitchen supplies, bedding, furniture, even paint, all at a fraction of what it costs to buy these items new.
In the process, we don’t have to sacrifice beauty, utility or quality. In fact, buying secondhand often allows us to purchase things we wouldn’t be able to afford in traditional outlets. Some of our recent great finds include the $2.50 black cocktail dress I wore for our anniversary dinner this year, the Italian leather boots I bought for $8, the classic pinstripe suit my husband found for $4, and a handmade quilt I recently bought for $20. Even our large collection of original artwork came from secondhand sources, each costing less than $20 apiece.
Friends who visit our home often remark on our finds. “How can you afford to buy so many pieces of original artwork?” a friend recently asked. “All the gallery pieces I’ve seen cost hundreds of dollars.” She didn’t believe me at first when I told her that I found every piece of art we have through secondhand sources.
Another visitor, who has interior design training and who is well acquainted with my thrift-focused shopping habits, registered the same kind of surprise when she came to our home for the first time. “Your home is warm and comfortable . . . and doesn’t look like a thrift store.”
These comments reflect a common misconception about thrift stores: buying secondhand means forgoing good looks. On the contrary, some of our most remarkable pieces—mohair chairs with an intricate nail head trim, a giant painting of the Moulin Rouge, a nearly-complete set of vintage china, and an Art Deco lamp—came from thrift stores or other secondhand sources. Sure, you’ll find flotsam and jetsam, garish lamps and brown plaid sofas, but there are plenty of unique and practical goods if you’re willing to look for them. A found thrift store treasure is also satisfying because it isn’t just something you can go out and buy anywhere – often, it’s an unexpected, one-of-a-kind find.
Buying through secondhand sources allows us to support small, local businesses and organizations that use the proceeds of their sales for worthy causes in our area. What’s more, buying the things we need secondhand qualifies as a “green” choice, as well.
Outfitting ourselves and our home this way does take time and patience. It helps to use a few tried-and-true bargain-hunting strategies. And if you overdo thrift-store shopping, you’ll defeat the purpose of trying to stretch your budget. But when you know what you want to buy – perhaps a painting, a grater for your kitchen, a dress for your daughter, or a chair for your desk – and you shop with purpose, you can reap some wonderful, affordable rewards. Next week, I’ll share some of my best strategies for shopping effectively in thrift stores and secondhand shops.

Insurance: Is a low rate always the best value?

When I opened our new escrow statement this week, I immediately looked at the total payment amount. I breathed a small sigh of relief when I saw that it was roughly the same as it had been before. Still, a closer look revealed that our hazard insurance premium was increasing. I whipped out my calculator and found that the increase amounted to an extra 15 percent.

I know it’s wise to get a new rate quote from competing insurance companies every year, but our insurance has become an expense we don’t tend to think about. We budget for it and record the automatic withdrawal in our checkbook register every month. Nevertheless, seeing an unexpected increase was enough to jolt me out of my complacency and remind me that we can’t assume we’re getting the best rate possible.

I dug out our policy statement and called our insurance agent the next day. He explained that the increase was caused by what he called “projections of future losses.” In other words, our home insurance premium was increasing so that our company could pay us (and other policy holders) in the event of widespread losses. He admitted we might be able to find a less expensive premium elsewhere, but he said we should consider the overall health of the company before we decided to make a switch.

After talking to my agent, I knew I needed to see how our rate compared to those of other companies. I called several insurance companies. Even though I was dreading the work of making phone calls and giving my personal and policy information over the phone, I found friendly, knowledgeable agents who were willing to help me. By the end of the day, I had several new quotes to consider.

All the quotes I received were lower than the hazard insurance premium we’re paying with our current company. Sometimes, the difference was negligible, but a couple of quotes came in significantly lower than ours. One company can beat our current rate by a whopping 30 percent. If we chose to switch companies, we would save close to $400 a year.

I can think of a lot of ways I’d like to spend $400, but my home insurance premiums aren’t on that list. Still, there’s more to consider than the rate alone. Part of the value of using our current company is that we’ve created a relationship with our agent. When I called him, he immediately knew who I was, and he took the time to explain the rate increase in terms I could understand. The insurance company we use is financially healthy and growing. That’s worth something to me.

Now I have to decide how much it’s worth. I plan to go back to my agent to see if he can give us a better deal on our hazard insurance. If he can’t, then we need to decide if we’ll knowingly pay more for our insurance or if we’ll do the legwork to change companies.

Either way, I’m glad I took the time to compare hazard insurance rates. (Now it’s on to automobile rates, too.) My husband and I are more informed consumers, and we can use this information to make smarter choices about how we spend our money.

Are you confident that you’re getting the best value with your insurance? If not, take time to get quotes from several companies. The work you invest could result in renewed faith in your insurance company, or perhaps, a switch to get better premiums so you can stretch your money farther.