Flight Ops

Flight Ops

Wednesday, October 01, 2014

Disaster Prep Wednesday: Disasters and Financial Preparedness

One thing too rarely discussed in disaster planning is the personal financial well-being of the potential victims of a disaster. It seems that those who are insured, have money in the bank and credit left on their cards may not be as newsworthy as the poor and near poor who have suffered losses.

Why? I would suggest the main reason is planning. I am not alone in suggesting this. The American Institute of Certified Public Accountants (AICPA) has provided a booklet devoted to the topic title, not surprisingly, Disasters and Financial Planning: A Guide for Preparedness which they say may help
In this booklet, you will find suggestions on steps you can take now to:
✦ Protect your family’s health, life, and property with adequate insurance.
✦ Consider disaster vulnerability and mitigation before making decisions about
relocating and making major purchases.
✦ Pay for a mitigation project.
✦ Plan financially for the possibility of a job loss or disability.
✦ Safeguard your important financial and legal records.
✦ Prepare your loved ones to weather a disaster even if you are not there to care for them.

Now many of us have been known to live -um- beyond our means. But there is another approach that involves living below your means - and in some case, going the extreme of working hard to have enough money to retire early - maybe even really, really early What 30-Year-Old Retirees Can Teach The Rest Of Us, which can be done if:
1. Embrace a very frugal lifestyle. That means cutting back substantially on biggies like your home and car expenses as well as learning to cook (to save on dining out and prepared foods) and to do more things yourself rather than pay someone else to do them.

2. Save like crazy­ — ideally at least 75% of your income — and invest the money. Put another way, if you can live on one dollar out of four and invest the other three, you’ll save enough money to cover three years’ worth of future expenses in just one year.

3. Once your investments are sufficient to support that very frugal lifestyle for the rest of your life, consider yourself free to retire. Fisker sets the savings target at 25 to 40 times annual expenses, depending on how many years you have ahead of you.
I'm sure there is room for you to develop your own plan in there somewhere, but the fundamentals are the same - wise selection of a living space, building up a nest egg, insuring what you have and keeping an eye on the future.

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