Facing disasters: Incorporating financial planning and emergency preparedness
Financial preparedness, financial planning and crisis management is really a necessity for those who are preparing for the worst-case scenarios happening in the near future
ON the second half of 2013, we have seen and experienced tumultuous numbers of natural disasters, man-made catastrophe, typhoons, armed conflicts brought about by political and ideological indifferences, and earthquakes. These incidents have inculcated in the minds of many how these disasters, may it be man-made or caused Mother Nature, have devastated and caused disruption on our lives and our daily routines. In one statement made by a disaster and risk management expert on TV said “Typhoon Yolanda will be benchmark for disaster preparedness in the years to come” if there will any more Category 5 storms coming in the archipelago.
The tragedy of these events made a deep impact to the consciousness and minds of Filipinos. Seeing the extent of damage is overwhelming for our local and national government in which it is already overburdened and limited resources are stretched to the limit.
Are we prepared for these types of disasters?
Many experts believe we are still ill-prepared for such disasters and take for granted the warnings. But we can take the initiative of preparing for such disasters. This year Australian Agency for International Development (AusAID), together with Metro Manila local government units and other national agencies, had made an assessment and released their report on the earthquakes and active fault lines in Metro Manila and nearby areas. Their predictions proved if a possible event of a 7.2-magnitude earthquake will hit the metropolis alone there will be an estimated 37,000 fatalities.
Is financial planning necessary for these kinds of events?
The answer is absolutely “Yes,” financial planning in possible disasters is very essential for everyone before natural catastrophes hit us. It still involves the standard non-investment topics, such as estate planning, asset risk protection and insurance risk management. You may not know what might happen during those times from damage of property to loss of life of a loved one in those challenging times. It’s better to prepare for worst-case scenario.
Is financial preparedness important during times of crisis?
Yes, despite financial advisors and planners thinking that it is out of the realm of financial planning, with the minority of financial-planning practitioners of incorporating crisis management as well. The importance of saving emergency cash on hand and keeping safe important documents from driver’s licenses, passports, birth and marriage certificates, family health records, insurance policies, real property titles, will and automobile records and other documents that are very crucial and are part of this process. Other steps to remember in ensuring the safety of these vital documents are to keep with digital backup copies or place them in a safe deposit box in a safe area or even file them in a private file-hosting site online could also be done in making your records safe.
When the disasters strike, what to do next?
Crisis management is very important in the event of these unforeseen natural disasters. Media outlets are proactive in participating in such drills or information-dissemination campaigns to the public on safety during times of possible disasters. Most survival experts and the United States Federal Emergency Management Agency would advise preparation of emergency grab-and-go bags lasting for three days and must contain basic essentials like food, water, batteries, transistor radio, flash lights, match sticks, emergency medical kits, water-purification tablets etc. Communication devices such as basic mobile phones or two-way radios are very useful in dire situations along with evacuation plans and exit strategies on where to go and evacuate. Briefing instructions is needed to children and other family members if getting separated from the group is necessary, if such case arises. Although, this is outside of mainstream financial planning realm, the purpose of this is to ensure safety and prevent accidents from happening in times of peril.
Financial preparedness, financial planning and crisis management is really a necessity for those who are preparing for the worst-case scenarios happening in the near future. In times of calamities and disasters we should be ready. These three are inter-related in unlikely situations that could possibly happen. It may sound pessimistic or grim for some people but somehow we have to be realistic and take the initiative to educate, protect and prepare ourselves, our loved ones and our properties from unforeseen perils.
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Benedict Baluyot is a Registered Financial Planner of RFP Philippines. He is professional real estate broker with specialization in project selling and general brokerage of different estate properties from different local and national developers in Pamapanga and Metro Manila residential and condominium projects.
Source: http://businessmirror.com.ph/index.php/en/business/banking-finance/24083-facing-disasters-incorporating-financial-planning-and-emergency-preparedness
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