Ways to Improve Your Financial Capability Now

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By: America Saves

Are you ready for National Financial Capability Month? Here are three actions you can take now to make sure you are prepared for any financial disaster, big or small.

1. Have a Disaster Plan for Your Finances.

Sure, you keep bottled water, canned goods, flashlights, and batteries close at hand, but you should also have a disaster plan in place for your finances. The first step is building and maintaining an emergency fund. Saving is the best financial defense against disasters. A little bit at a time can go a long way. Then you can make sure the rest of your finances are in order.

The Federal Emergency Management Agency (FEMA) has an Emergency Financial First Aid Kit (EFFAK) that is great for identifying all your important financial information and then helping you keep track of it. The EFFAK also provides advice on managing finances, offers insights on dealing with credit scores, and describes what to expect should a disaster strike your community. All of this will help your family prepare today for both the big incidents and minor emergencies.

2. Check Your Financial Well-Being.

Just like you should go see a doctor once a year for a check-up, so too should you assess your financial wellness. Like your health, you should assess your savings annually to make sure you are saving for all the right things. Evaluate the status of your savings to see if you are saving adequately and create a savings plan. Start saving automatically by setting up automated regular transfers with your bank or credit union so your savings will increase each time you get paid. Automating your savings can take the guesswork out of reaching your savings goals.

The Consumer Financial Protection Bureau (CFPB) has a nifty tool that lets you take a ten question quiz that not only evaluates your financial well-being but also compares you to other Americans in your age group. Then it suggests ways to improve your score and where to find help.

3. Make Sure You’re Properly Insured.

Review your insurance coverage. Most homeowners and renters insurance policies do not cover flooding, so you may need to purchase a separate policy from the National Flood Insurance Program. An inch of water in your house can cause $25,000 of damage and 20% of flood claims come from areas outside of flood zones. Think because you’re a renter you don’t need insurance? If you don’t have renters insurance, and you lose your personal property to theft or disaster, you will have to replace everything out of pocket.

Let America Saves help you save money. It all starts when you make a commitment to yourself to save. Take the first step today and take the America Saves pledge to save money, reduce debt, and build wealth over time. And it doesn’t stop there. America Saves will keep you motivated with information, advice, tips, and reminders to help you reach your goal. Think of us as your own personal support system.