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Weekend Challenge 17: Preparing for Emergencies

Preparing for Emergencies

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This weekend the challenge is to get prepared for emergencies. There are several different types of emergencies that you may face, but it is not difficult to have specific things in place to face most of the emergencies that you will have to deal with. The emergencies could be health related, job or money related or caused by nature. This easy challenge should prepare you to be able to cope with these challenges. Nearly every type of emergency affects your finances somehow. By having a plan in place you can save money and have peace of mind when you face the difficult situations.

1. Financial Emergencies

An emergency fund of one or two thousand dollars should be enough to cover any deductibles or car repairs that you may need to pay for. If you have paid off all of your debt or if you feel that you job is not secure you should begin to build a larger emergency fund. It should cover six months of your expenses. You can put your emergency fund in a money market account or a CD ladder. You can also create a spending plan that you would use if you were to lose your job. This would include cutting back on unnecessary expenses. With careful planning you can avoid an income crisis.

It is also important to have adequate insurance. You should have health insurance, home or renter's insurance, as well as car insurance. If you live in a flood plain you should also have flood insurance. This insurance protects youfrom losing money when an accident or disaster happens.

2. Other Emergencies

It is also important to be prepared to face emergencies that are not financial. For example it is a good idea to have a supply of stored water on hand. A two-week supply should get you through most emergencies easily. You should have a gallon of water per person per day stored. This is great to have on hand in case the water supply becomes contaminated which happens occasionally. You should have a five day supply of food and water in a kit that you can take with you in the event that you had to evacuate or if you lost power because of severe weather such as a snow storm or a hurricane. The food you store should be easy to eat without heating it up. This can help if you are unable to visit a store for a short time due to illness.

3. Create a Disaster Plan

Finally create a plan that goes through several scenarios and outlines what you will do in each situation. For example you may want to choose where you will go if you need to evacuate an area. If you have children you should have a meeting point for them or a plan to get to them if school is cancelled early one day or in the event of a disaster. The plan will only take about a half an hour to create, but it will allow you to focus on getting to safety instead of scrambling around frantically in the event of an emergency. The plan should also include lists of contacts with the numbers written down in case your cell phone battery dies and you need to contact people without access to your phone.

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