{"id":12925,"date":"2026-01-14T15:55:52","date_gmt":"2026-01-14T21:55:52","guid":{"rendered":"https:\/\/www.discover.com\/online-banking\/banking-topics\/?p=12925"},"modified":"2026-02-06T12:12:44","modified_gmt":"2026-02-06T18:12:44","slug":"prepare-your-finances-for-a-natural-disaster","status":"publish","type":"post","link":"https:\/\/www.discover.com\/online-banking\/banking-topics\/prepare-your-finances-for-a-natural-disaster\/","title":{"rendered":"Disaster finance: 4 tips for financially preparing for natural disasters"},"content":{"rendered":"\n

Wildfires were ripping through Northern California. Eiman Jahangir woke up at 2 a.m. to someone pounding on his door. The voice on the other side was urging him to evacuate immediately. \u201cI grabbed my wallet and clothes for our kid, and that was about it,\u201d says Jahangir, a university professor and former personal finance blogger. His home was destroyed. He and his family lost everything that was left inside.<\/p>\n\n\n\n

\u201cI was by no means prepared,\u201d Jahangir says. He\u2019s not alone. A Bankrate survey<\/a> found that more than 1 in 5 U.S. adults don\u2019t have any emergency savings to tap into if a natural disaster were to strike. More than one-half of respondents couldn\u2019t cover three months of expenses in the wake of an emergency.<\/p>\n\n\n\n

Thankfully, Jahangir and his family eventually financially recovered from the wildfire.<\/p>\n\n\n\n

Financially preparing for natural disasters has never been more important because environmental catastrophes are, sadly, increasingly common. 2022 marked the seventh consecutive year<\/a> in which the U.S. sustained at least 10 separate billion-dollar disasters. In 2021, there were 20 billion-dollar disasters, according to the same research. <\/p>\n\n\n\n

Costly home repairs<\/a>, extended hotel stays, insurance deductibles, even job losses: Natural disasters can wreak havoc on your finances, creating debt and credit issues and even leading to bankruptcy.<\/p>\n\n\n\n

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So, how do you financially prepare for a natural disaster? The best way to be ready for an emergency is to implement some disaster finance tips in calmer times. That way, if disaster strikes, you\u2019ll be able to deploy your recovery plan. Here are four ways you can prepare your finances for a natural disaster:<\/p>\n\n\n\n

1. Build an emergency fund\u2014and have a cash cushion<\/h2>\n\n\n\n

When preparing for natural disasters, setting aside money in the case of an emergency is one of the smartest steps you can take. But if you don\u2019t currently have a well-stocked emergency fund, don\u2019t worry\u2014you can get started today. Ryan Frailich, CFP\u00ae<\/sup>, owner and founder of a New Orleans-based investment advisory firm, says that you can start saving a portion of your income each month to build your emergency fund.<\/p>\n\n\n\n

\u201cIf you\u2019re socking away money every month, you\u2019ll be prepared for that rough patch,\u201d Frailich says. \u201cAnd while it may be unpleasant, it won\u2019t be a huge financial stressor<\/a> or lead to credit card debt.\u201d<\/p>\n\n\n\n

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If you\u2019re ready to start an emergency fund<\/a> from scratch, you\u2019ll want to consider how much you need to save. Many natural disaster finance experts recommend you save anywhere from about three to 12 months of core household expenses, so that you can cover your housing payments, insurance premiums, and groceries, plus any disaster-related expenses that might arise.<\/p>\n\n\n\n

In addition to saving money for your core expenses, you also might want to consider saving money to purchase supplies for your emergency kit. (For more on emergency kits, see tip 3.) If you\u2019re hunkered down at home, at the very least you might need water, flashlights, and batteries, Frailich says, adding that these and other emergency household supplies can range anywhere from $75 to $300.<\/p>\n\n\n\n

While you\u2019re getting your disaster finances in order, you might figure out whether you want to keep a small stockpile of cash at home in a safe but accessible place. Frailich keeps a bag set aside with a few hundred dollars in case there\u2019s a power outage and he can\u2019t get money electronically.<\/p>\n\n\n\n

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Saving up for potential evacuation expenses, such as lodging, meals, and transportation, is an additional way of financially preparing for natural disasters. Frailich recalls having to leave his home due to an approaching hurricane. Even though the storm passed without damaging his property, he still had to cover the costs of a hotel room, gas, and food while on the road. \u201cIt turned out to be nothing, but I still spent $500,\u201d Frailich says.<\/p>\n\n\n\n

As you\u2019re prepping your finances for a potential disaster, you\u2019ll also want to consider where to keep your emergency fund<\/a>. Keeping it in a separate account can reduce the temptation to draw from it for nonemergency expenses. A high interest rate online savings account, for instance, can be an ideal place to build up an emergency fund because it allows your money to grow and earn interest while you\u2019re not using it.<\/p>\n\n\n<\/div>\n\n\n

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\u201c1 in 5 U.S. adults don\u2019t have any emergency savings to tap into if a natural disaster were to strike.\u201d<\/p>\n