6 Tips for Handling Money During a Disaster

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A woman helps hand out supplies after a natural disaster

Life doesn’t always go as planned. Emergencies, natural disasters, unexpected health issues, job loss, even pandemics always seem to pop up at the most inconvenient, most unexpected times. And when life doesn’t go as planned, the plans you made for your money can sometimes change course too. Here are 6 tips to help you handle your money during a disaster.

1. Build an Emergency Fund

Providence favors the prepared—words that were never truer than during times of disaster. Before disaster strikes, do your best to save for unexpected emergencies. According to Bankrate, only 1 in 4 adults could cover the cost of an unplanned $1,000 expense. Try setting aside a little money every month in your personal budget. You may also consider putting that money into a separate savings account that can earn extra interest (and help you avoid the temptation of tapping into emergency funds for non-emergency reasons). It’s also a good idea to keep some cash on hand, in case your money isn’t immediately accessible.

2. Build up Emergency Supplies

One of the many unfortunate realities of disasters (especially widespread disasters) is that they tend to turn the economy to the disadvantage of the average consumer. When demand goes way up, so do the prices. You can save a lot of money during a disaster just by being prepared with several weeks (or longer) worth of food, as well as other necessary and potentially lifesaving supplies. Carefully keep track of first-aid supplies, prescription medications, even firewood (as recent events have shown). If you have the means and opportunity to plant your own vegetable garden and/or fruit trees, having access to free food when money is scarce is always a good thing.

3. Put Your Money Where It Matters

You can’t save every penny you make, but you can try to spend your money on things that will improve your financial position, appreciate your assets, and put you in a better all-around position when disaster strikes. Consider saving up for a home, or making necessary repairs and upgrades to your existing home that will keep you and your family protected. Coincidentally, these kinds of expenses can also improve your home’s value, putting you in a better financial position. If your financial situation allows, save up for reliable transportation—something that usually comes in handy during times of disaster. And do your best to properly maintain these assets over time.

4. Put your Paperwork in Order

Prepare for unexpected disasters by gathering important documents into a single location. That includes insurance policies, bank account information, estate planning documents like wills and financial powers of attorney, as well as a list of assets and liabilities. Not only will this save you time and energy (when time and energy are best devoted to the disaster at hand), it might just save you money by being able to claim insurance funds or pay for unexpected expenses more quickly and efficiently. If you store these documents electronically, consider printing them out and putting them in a single file folder for safekeeping, just in case your disaster involves a lack of electricity. While you’re at it, take the time to review potentially money-saving investments like health, flood, earthquake, or fire insurance appropriate for your situation.

5. Separate the Essentials from the Extraneous

When the going gets tough, the essential expenses take priority. Evaluate your spending over the past several months. Look at credit card and bank statements and write down every purchase you have made. Now that money is tight, it’s important to separate each purchase into two separate categories—essentials and non-essentials. Tally your monthly spending for each category so you can know how much money you can expect to spend each month moving forward for the foreseeable future. Cut back where you can. Chances are if something feels non-essential, it probably is. Essential purchases include groceries (not eating out), utilities, housing, insurance, and transportation, but may differ from person to person.


A woman helps hand out supplies after a natural disaster

6. Find Help and Income Opportunities

Sometimes disaster strikes in the form of losing your financial situation. Natural disasters and other widespread emergencies can have a profound impact on the economy, which trickles down to hard-working money makers. When disasters of this ilk happen, take advantage of government or other programs that can help you get back on your feet. That may mean filing for unemployment benefits, finding help at food banks, or exploring emergency grant or payment assistance programs. It may also mean taking a chance on a new job in an entirely separate field. When disaster strikes, assess all your opportunities, even those income opportunities that weren’t part of your original plan.


When disaster strikes and life doesn’t go as planned, you can still be smart with your money. Plan for the unexpected, and when the unexpected inevitably happens, follow through with those financial plans that will help you save money and take advantage of available resources. Disasters are never convenient, but the way you plan for and react to disaster can help you get back on your feet and back on course with your personal and financial plans a lot more quickly.