Steps in Creating a Financial Action Plan to Protect Your Family Ahead of a Natural Disaster

AICPA/Harris Poll Shows 32 Percent of Americans Aren’t Financially Prepared for a Natural Disaster

Natural disasters are unpredictable and can bring devastating personal and financial consequences. Yet despite the frequent headlines, many Americans remain unprepared.

According to a survey conducted by The Harris Poll on behalf of the AICPA, nearly a third of Americans (32%) have not taken any financial steps to prepare for a natural disaster. Sixty-six percent of Americans however, said that a natural disaster would have a major or moderate impact on their financial situation – revealing a significant gap between risk and readiness.

Every household can benefit from proactive disaster preparation. Often simple and straightforward advance steps can help mitigate the impact of disasters and make it easier to rebuild and move forward in the aftermath. Here are a few steps you can take now, to help protect your family and finances should disaster occur.

Build an emergency fund

According to the April 2025 AICPA/Harris Poll survey, only 27% of Americans have either started or increased an emergency savings account over the past 12 months, marking a clear opportunity to improve financial preparedness by taking a few simple steps.

An emergency fund is more than just a “rainy day fund,” which is generally thought of as a small amount of savings set aside for occasional extra expenses. A true emergency fund is a safety net that can be used in case of larger emergencies, such as a natural disaster or major illness, without derailing your long-term financial goals. With an emergency fund in place, it won’t be necessary to tap into retirement accounts or home equity or rely on high-interest credit cards.

• In the days following a natural disaster, banks and ATMs may be inaccessible. Keep a portion of your emergency fund in cash stored securely in a fireproof, waterproof home safe.

• Aside from having ready cash, the balance of the emergency fund should be in liquid assets such as a high-yield savings account that you can access quickly.

• Keep your emergency fund account separate from your regular checking and savings accounts so that you’re not tempted to tap into it for daily needs, splurges, or other occasional non-emergency expenses.

Make a financial plan

If you don’t have everything in place yet, don’t panic. A sound financial plan for responding to and recovering from natural disasters is the foundation of being prepared to face the next disaster with a good road map. Building a resilient plan can help identify current financial vulnerabilities along with creating an action plan to be prepared financially for whatever Mother Nature may send your way.

Financial planning includes important steps, which include:

• Reviewing and updating your insurance policies to ensure adequate coverage

• Taking an inventory of assets and possessions for insurance claims

• Creating or updating essential documents such as a will or estate plan

• The disaster plan will also include a few non-financial elements as well, including:

• Developing an emergency communication plan with primary and backup contacts

• Identifying evacuation routes

• Assembling an emergency supply kit with at least three days’ worth of day-to-day supplies

Will your insurance cover you in case of disaster?

The AICPA/Harris Poll survey revealed that only 31% of Americans have evaluated their insurance needs to assure adequate coverage, and 30% have taken an inventory of assets and possessions for insurance purposes. Even fewer – just 21% - have purchased additional insurance, such as flood or hurricane insurance, to prepare for natural disasters.

Do you have the right type of insurance to cover natural disasters that may strike your area? Take time to review your homeowner’s, renter’s, auto, flood and earthquake insurance, and make sure each one offers appropriate coverage for disasters.

Even if you do have the right type of coverage, there’s still another step. Insurance isn’t a “buy it an forget it” proposition.” Chances are, the contents of your home have changed since buying the policy. Take an inventory of your valuable possessions, appliances, furnishings, jewelry, and collectibles (including photos).

Protect important financial documents

Being able to easily locate important financial documents such as wills, insurance policies, and other financial records will be essential in the hours and days after a disaster. Yet only 29% of Americans reported that they have backed up and stored financial records in a safe, accessible place.

A few of the most important items to track include:

• Automobile titles

• Identification records

• Inventory of valuables

• Insurance policies

• Property deeds

• Mortgage or lease documents

• Military records

• Wills and trusts

• Powers of attorney

• Bank account and credit card information

Having easy access to these documents following a disaster will help make the recovery and rebuilding process a little easier.

You may consider using encrypted, password-protected cloud storage for those documents that are digital; while also using a traditional safe deposit box, or a fireproof and waterproof home safe.

Create or update your will and estate plan

The AICPA/Harris Poll survey shows that only 19% of Americans have created or updated an estate plan and/or a will to prepare for a natural disaster. In some cases, disasters such as pandemics, earthquakes, hurricanes, and fires and floods can result in devastating injury or loss of life. Having these things in order can provide clarity and peace of mind for loved ones and reduce stress for survivors during what is sure to be a difficult time.

Depending on your financial situation, you may need key financial documents such as:

• A living trust

• A last will and testament

• Durable power of attorney

• Health care proxy

• Beneficiary designations on retirement accounts and insurance policies

It is advisable to engage professionals, or if cost is a concern, contact a legal aid clinic or law school to find out if services may be available for free or at a reduced rate. Check with your employer to see if you may have legal benefits through your EAP.

Preparedness today makes recovery easier tomorrow

At its core, disaster preparation is to hope for the best but prepare for the worst. By getting your financial house in order, building an emergency fund, safeguarding important documents, and reviewing your insurance and estate plans, you can help reduce the stress and disruption a disaster may cause – and recover more quickly when the unexpected occurs.

A note on the survey methodology: Two surveys were conducted online within the United States by The Harris Poll on behalf of AICPA. The first survey was conducted from April 1-3, 2025, among 2,081 adults age 18 and older and the second from June 13 - 17, 2025 among 2,093 adults ages 18 and older. The sampling precision of Harris online polls is measured by using a Bayesian credible interval. For this study, the sample data is accurate to within +/- 2.5 percentage points using a 95% confidence level.