In the blink of an eye, natural disasters like wildfires, hurricanes, or floods can turn lives upside down. Recovering financially from such devastation can be a lengthy process, but there are numerous avenues of assistance available to those affected.
Here are some ways to seek help and make smart decisions with your resources as you embark on the journey to rebuild your life after a disaster.
Address immediate needs first
The first step is to reach out to the Federal Emergency Management Agency (FEMA) for assistance. You can do this by texting “DRC” followed by your ZIP code to 43362. Additionally, texting “Apple” or “Android” to the same number will provide you with a link to download a FEMA mobile app with valuable resources such as shelter locations.
Local and state agencies, as well as organizations like the Red Cross, can also offer support. Dial 211 from any phone or visit 211.org for information on available assistance.
Don’t forget to check your credit card or hotel loyalty accounts. You may have points or free night certificates that can cover your immediate lodging expenses.
Certain rewards credit cards allow you to use points to book hotels through their travel portals or transfer points to specific hotel loyalty programs. Some nearby hotels might even offer discounts for evacuees.
Address financial matters next
Immediately focus on managing your finances. FEMA provides assistance such as unemployment aid, rental support, and legal services. You can register online at DisasterAssistance.gov, through the FEMA app, at a disaster recovery center, or by calling 800-621-3362 (FEMA).
Money Management International, a nonprofit credit counseling agency, offers Project Porchlight, a free program that provides assistance to disaster victims for up to a year. This program helps individuals navigate the recovery process, meet deadlines, and address the challenges of handling tasks during a crisis.
There are several tasks you need to address:
Contact insurance providers promptly
Act swiftly to maximize your benefits from home insurance, renters insurance, or auto insurance.
Review your policies to understand the types of damage covered, coverage limits, and deductibles. Note that standard home and renters insurance policies usually do not cover flood damage, so if you have flood insurance, review that policy as well. Comprehensive insurance on your auto policy typically covers flood and wind damage to your car.
Report any damage to your insurance company or agent as soon as possible. With a surge in claims following a disaster, early filing is essential.
Inquire about coverage details, claim filing and processing timelines, deductible considerations, and whether repair estimates are required for structural damage. Ask about coverage for living expenses if you are displaced, reimbursement for car rentals, and coverage for food spoilage losses.
When communicating with your insurer, seek guidance on what items to discard and what to document for your claim. Take photos and videos of the damage, and take steps to secure your property. Keep detailed records of all interactions with the insurance company. Learn more about how to file a home insurance claim.
Contact your mortgage lender and other creditors
Mortgage forbearance can help you avoid foreclosure by allowing partial payments or pausing payments for an agreed-upon period.
Communicate proactively with creditors, advises Bruce McClary, spokesperson for the National Foundation for Credit Counseling. Factors like impassable roads and power outages may hinder timely payments. Once your creditor is informed of these challenges, they may offer temporary payment relief, such as waiving fees or reducing interest rates for a period.
In areas with disrupted power and communication, you may need to use your credit card at ATMs for cash. Keep in mind that cash withdrawals on credit cards typically incur higher interest rates.
Request a pause on student loan payments and seek aid from your college
Federal student loan borrowers can apply for a natural disaster forbearance, allowing for reduced or paused payments for up to 90 days.
Private student loan borrowers should contact their lender to inquire about payment relief options, as they vary by lender.
If you are a current student facing financial hardship due to a disaster, reach out to your school’s financial aid office to discuss potential adjustments to your aid package. Additionally, consider applying for emergency financial aid from your school.
Notify your school’s financial aid office (or student loan servicer) of any changes in your residence if you have been displaced.
Strategize your approach to aid, credit, and debt as you navigate recovery
Kate Bulger, Vice President of Business Development at Money Management International, emphasizes the importance of applying for available aid and preserving cash to ensure sufficient funds for rebuilding efforts post-disaster.
Once you have exhausted aid and emergency funds, you may need to rely on credit to cover essential expenses or repair costs. Some major credit card issuers now offer options to convert available credit into installment loans at lower interest rates or break down large purchases into manageable monthly payments.
When you have a clearer picture of your debt situation, explore strategies for paying down balances. The debt snowball method, which prioritizes paying off the smallest debt first while meeting minimum payments on others, can provide quick victories and motivation.
Lastly, familiarize yourself with debt relief options for managing debts that exceed your repayment capacity.
BW writers and editors Caitlin Constantine, Meghan Coyle, Eliza Haverstock, Lauren Schwahn, and Kate Wood contributed to this article.
(Lead photo by Mario Tama/Getty Images News via Getty Images)