Tired of This Economy? Here are Five Ways to Get Prepared for Future Financial Earthquakes

By , Columnist

QuakeFinder, the geologically-focused branch of a satellite consulting firm in Silicon Valley, is convinced that tracking electromagnetic changes in the earth will predict upcoming seismic events. Sadly, the United States Geological Survey thinks this science is bunk, as do many seismologists, because unfortunately there are just some natural disasters that we can’t foresee. More unfortunately, the same holds true for some man-made institutions… like this economy, for instance.

But while we can’t yet predict earth-shifting changes in tectonic plates or bank accounts, we can prepare for them. According to the U.S.G.S. website, here are a few earthquake dos and don’ts and how they might apply to your poor, freaked-out wallet:

Make sure your structure is up to code.

Based on the average size of earthquakes in a given area, homes and buildings have enhanced structural components that allow them to move with the ground to a certain extent, because rigid structures without flexibility are far more likely to crumble and fall, causing more damage. Structure your finances similarly.

Don’t hoard every penny in one account. Have multiple disaster funds: a general emergency fund that can ideally cover six-plus months of living expenses, and funds for each of your big ticket items like cars, computers, appliances, etc.

Also, invest in multiple formats. Taking a varied approach to investing might potentially lower short-term yield, but it will help insure long-term stability. Speaking of long-term, be sure that your investing schedule also includes regular contributions to a 401(k) or IRA.

Know where your resource shutoff valves are and how to turn them off if there’s a problem.

Gas, electric, and other essential resources can be extremely dangerous if left on during an earthquake and could lead to further disaster (think a gas leak and exposed live electrical wiring - talk about asking for a fire). If the dirt hits the fan in the economy - or in your own personal economy - you need to know which streams of financial outgo might be detrimental to making ends meet and how to quickly shut them off. Keep passwords to your accounts handy, and know ahead of time which services are non-essential, are downsizable, or have no- or low-penalty cancellation policies.

Talk to those closest to you to figure out how you can help each other after a quake.

Because world finances are so rocky right now, it’s not weird to talk to family and friends about “what if” scenarios. Know who your resources would be in the unlikely event of a financial disaster; would you have the option of moving back with your parents, carpooling with a neighbor, or having a friend watch your kids for a discounted price? Plan ahead so you don’t add to your panic later.

Expect aftershocks.

When you’ve been sitting in traffic on the interstate for an hour and things finally start moving, it’s easy to get overly optimistic, step on it, and end up rear-ending the guy in front of you because - oops - he stopped again. Same goes for disaster scenarios. Humans are inherently optimistic creatures and we WANT to believe that when the “badness” is over, it’s really over. Since that’s not always the case, it’s essential that we don’t just step on it as soon as the worst passes. Don’t make any overly significant decisions about buying, selling, withdrawing, or shifting funds until things have stabilized a little.

Assess the damage.

Assuming something does happen, don’t procrastinate assessing your accounts and don’t be overly optimistic when you do. Rose-colored glasses won’t help, so be practical and honest with yourself about the state of your post-disaster affairs and plan proactively how to dig yourself out of the rubble.

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Emmie Scott is an English major-turned-marketing exec, with a passion for writing, humor, sharing knowledge, and "pink drinks." After hours, she started Are Toe Rings Professional Attire?, a blog for college grads and twenty-somethings looking to find their way through that daunting labyrinth called…

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