Disaster-proof your important papers
By Andrea B. Terry • Bankrate.com

You have five minutes to clear out of your house.

Five minutes to grab every crucial financial document before the house crumbles -- property titles, wills, insurance records, Social Security cards -- and you need to do it, even with all the chaos surrounding you.

Could you do it? Would you even know what to grab?

Fortunately, with a bit of planning you can track your most important financial records and keep them out of the clutches of flames, floods and even potential Y2K problems.

By spending a little time now preparing for the worst, you'll be more likely to remain calm in the eye of a storm -- confident in the safety of your financial documents. That will allow you to spend the crucial moments in a disaster thinking about more important things.

Like getting your loved ones out of the house safely.

Searching for the key
Just because you're a good record-keeper doesn't mean you're a good safekeeper of records. My parents, for example, are well-organized people who file papers into folders and lock them in a cabinet. Would they be able to snatch up all of the important financial records in five minutes? Not likely. I love them dearly, but I also know them -- it would take them five minutes just to find the key!

Don't know where to start? Organizational expert Barbara Hemphill, president of Hemphill & Associates in Raleigh, N.C., offers these suggestions:

• Collect important personal papers and information related to financial transactions.
• Identify a single location to file all crucial papers -- a fireproof box or safe-deposit box.
• Create copies now (certified, in cases of birth certificates and other crucial documents) in case you need them to provide to government agencies.
• Put important original documents in plastic covers to protect them and to prevent you from accidentally giving away the original.
• Notify the appropriate people where important information will be located, in case you're not available when it is needed.
• As you go through your day, be aware of the kinds of information that you should add to your filing system. Identify a method, such as an index card in your pocket or mini tape recorder in your car, to make notes of new items as they pop into your mind.
• Identify the records that you or your financial institutions keep only on computer. Because they may not be available if electrical power fails, make printouts.

When it comes down to organizing and storing the information: "Marriage records, divorce decrees and birth certificates -- keep in a safe-deposit box. And don't carry the key with you -- keep one key in the house and one with another person," advises Catherine Williams, president of Consumer Credit Counseling Service of Greater Chicago. The other person having a key could be a relative or attorney.

Using a PC
Computer software can help you get organized. "PCs offer all sorts of great tools and software that are relatively inexpensive," says Williams.

Consider Hemphill's program, Taming the Paper Tiger ,from Kiplinger. The software guarantees you can find anything in your file in five seconds or fewer. The organization is entirely computer-based; the actual filing of documents is both computer-based and paper-based.

The CD-ROM version also offers video and sound, in which Hemphill provides moral support. It's impressive -- and pricey, at $79.95.

A notch below that price are the big-name financial software programs, including Intuit's Quicken and Microsoft Money. Tracking programs for personal inventory financial documents are a small part of their much larger money management programs.

At the basic end is LifeMate Systems, which for $10 offers a spiral-bound book that allows you to keep track of home and office inventory. Software that performs the same task is $9.95. You itemize objects room by room, filling in serial numbers, purchase dates and estimated values. It's great for insurance purposes.

"People don't have to change their habits," touts Victor Taylor, president of LifeMate Systems Inc. in Scottsdale, Ariz. "The guide we provide is pre-formatted so it helps you to organize ... the most important documents."

Be sure you have backups
Software won't do you much good if it's in a computer that a flood has carried away. So no matter which software program you use, make a backup and store it away from your home. "Update your floppy disk about every 90 days and add it to the safe-deposit box," Williams says.

If you or someone you love is computer-shy, then FAMILYFAX USA may be the answer for record-keeping. The 112-page notebook enables you to document all assets, bank/credit accounts, insurance policies, investments, properties and many other useful personal records.

The price tag for this handy three-ring binder: $55.90. As copyright owner Robert Reinman puts it, "Your FAMILYFAX USA will more than pay for itself through financial control."

So no matter how you organize your records or where you store them, the bottom line is to take action today. Be sure to involve your family, friends and financial professionals whenever possible in decision making and planning. Do it now, before the unexpected becomes a harsh reality.

-- Posted: July 14, 1999