By Allen Giese, CLU®, ChFC®, ChSNC®, with OpenAI
When Hurricanes Helene and Milton recently passed through, they caused significant damage, leaving many families in precarious financial positions. Losing your home and personal belongings in any kind of disaster, whether hurricane, fire, or flood, can be devastating both emotionally and financially. Here are a few financial steps you should consider after disaster strikes.
1. Assess Damage and File Insurance Claims
Document Damage: Take photos and videos of any property damage. This will be critical for filing insurance claims.
Contact Your Insurer: Notify your homeowner's, auto, or renter’s insurance company as soon as possible to begin the claims process.
Review Policy Coverage: Understand what your insurance covers, including deductibles for hurricane or flood damage, and verify whether additional living expenses like hotel stays are covered.
Track Expenses: Keep receipts for repairs, temporary living costs, and any other expenses related to the hurricane.
2. Apply for Federal Assistance
FEMA Assistance: Apply for disaster relief from the Federal Emergency Management Agency (FEMA) for uninsured or underinsured losses. Visit the FEMA website at FEMA.gov or call their helpline to apply.
Disaster Loans: The Small Business Administration (SBA) offers low-interest disaster loans to homeowners, renters, and businesses. Consider applying if you need funds for repairs or rebuilding.
Other Local Aid: Look for state, county, or city disaster relief programs, as well as nonprofit organizations that provide financial assistance.
3. Contact Creditors and Utility Companies
Request Payment Extensions: If your income has been disrupted, contact your mortgage lender, utility companies, and credit card companies to request payment deferrals or forbearance. Many companies offer disaster relief options.
Document Conversations: Keep a record of communication with creditors and utility providers, including any agreements to defer payments or waive late fees.
4. Review Cash Flow and Budget
Reassess Your Budget: In the aftermath of a disaster, prioritize immediate needs like food, water, shelter, and medical care. Adjust your budget accordingly.
Access Emergency Funds: Use your emergency savings if necessary to cover immediate expenses, but be cautious about depleting these funds too quickly.
Minimize Non-Essential Spending: Postpone non-essential purchases and focus on recovery-related expenses.
5. Check if There is Tax Relief
On October 1, the IRS announced disaster tax relief[1] for all individuals and businesses affected by Hurricane Helene, including the entire states of Alabama, Georgia, North Carolina, and South Carolina and parts of Florida, Tennessee, and Virginia. Taxpayers in these areas now have until May 1, 2025, to file some individual and business returns and make tax payments.
6. Check Your Credit Report
Monitor Credit for Errors: In the aftermath of a disaster, it's common to overlook financial details. Check your credit report for any inaccuracies, especially related to late or missed payments, and dispute any errors.
7. Prevent Fraud and Scams
Be Wary of Fraud: Scammers often take advantage of disaster situations. Be cautious of contractors requesting full payment upfront, unsolicited calls for donations, or people asking for personal financial information.
Secure Personal Information: Protect important documents like your Social Security card, insurance paperwork, and financial records. If any are lost or damaged, take steps to replace them as soon as possible.
8. Repair or Rebuild
Get Multiple Estimates: If you need repairs, get estimates from licensed contractors. Make sure to document the process and work with reputable companies.
Prioritize Safety: Spend on immediate repairs that ensure the safety of your home and family first. If possible, wait until insurance payouts are confirmed before starting major work.
Being proactive and organized in the financial recovery process can help you get back on your feet after a hurricane or other natural disaster.
1. https://www.irs.gov/newsroom/irs-provides-relief-for-helene-various-deadlines-postponed-to-may-1-2025-part-or-all-of-7-states-qualify