As you collect W2s, 1099s and other tax documents, take a few extra steps to prepare an emergency financial first-aid kit. You never know when a pandemic, blackout, superstorm, fire or cyberattack will come.
The waterproof kit should contain essential documents you will need to reconstruct your financial life after a disaster — and also to help you get through one.
“Some docs you’ll need right away, and others you might not need right away but are difficult to replace,” said Neal Stern, a certified public accountant. “Some you have to have the original; some, a copy will suffice.”
Keep originals of identification: driver’s and marriage licenses, birth certificates, passports and Social Security cards, he said.
After a disaster, you may have to re-establish your ID, replace credit cards, complete a change-of-address form or apply for government assistance. Copies of those items could be kept in a secure cloud storage service, he added.
“If you can’t document who you are, it’ll be hard to get help,” said Stern, who is a member of the AICPA National CPA Financial Literacy Commission.
When people do get prepared for a disaster, said Jim Judge, a member of the American Red Cross Scientific Advisory Council, “oftentimes the financial side is not what people pay attention to.”
Judge keeps his important documents in a small plastic bin under his bed. He also stores money. “Cash is king,” he said, especially if the power is out and ATMs are not working.
Adam Levin, the ex-director of the New Jersey Division of Consumer Affairs who lost a house to Superstorm Sandy, recommended also creating a digital file of documents.
He suggests keeping digital copies of key financial documents on an encrypted waterproof USB flash drive. “If your bug-out kit gets into the wrong hands, it could be a nightmare,” he cautioned.
Adapted from the New York Post.
1. Disconnect. Shut off the circuit breaker, remove the fuse or slide the refrigerator away from the wall as needed to remove the refrigerator’s plug from the electrical outlet. Shut off water supply lines if equipped with ice maker or water dispenser.
2. Locate the condenser coil. There are two sets of coils for cooling appliances like refrigerators, they are called the evaporator and condenser coils. Overly simplified, the two coils are filled with gas and liquid respectively, and are parts of a complex “circuit” that has a compressor and expansion valve that perform the work. The gas filled evaporator coil is located in the space to be cooled, and performs the task by absorbing heat from that space. It is usually protected from damage and out of view inside the freezer section. The “heated” gas is compressed by the compressor, where it is further heated (hot to the touch) by the compression process. The heated compressed gas and liquid is passed through the condenser coil that is located away from the cooled space. This condenser coil is where some of the heat in the liquid is released to the ambient air. The cooled liquid is then drawn through the expansion valve by the suction of the compressor, where the liquid immediately boils off to a gas. This causes the temperature of the gas to drop significantly (well below freezing) in the evaporator coil. The process repeats until the thermostat in the space is satisfied. Because the condenser coil is exposed to the ambient air on the refrigerator, it requires regular cleaning. There are a few locations that the condenser coil may be found:
Older refrigerators have the coil (a grid-like structure often painted black) mounted on the rear of the refrigerator.
A. Toe space panel. Remove the panel at the bottom of the front of the refrigerator and carefully slide the condensate tray out (if present, the condensate tray may contain water). A visual inspection upward into this space may reveal a flat condenser coil when located here.
B. Rear access panel. If not found behind the toe space, the refrigerator will have to be slid away from the wall further to work from behind. Disconnect water supply lines if too short to allow enough room to work. Remove the fasteners that holds an access panel in position. The condenser coil may be flat, but will likely be cylindrical in shape when located here.Newer refrigerators often locate the condenser coil at the bottom. It is likely that a fan (that may or may not be readily visible) will be directed at the coil to assist with heat dissipation. Use a flashlight to assist locating the coil and fan if needed. The coil will be accessible from one of two places:
3. Disconnect power. Make sure the power to the refrigerator is disconnected.
4. Vacuum the coils. With a plastic crevice or brush attachment, carefully vacuum dirt and dust wherever it is seen. Use care not to damage the fins or coil. A breach created in the coil will allow the refrigerant to escape and will likely result in an expensive repair.
5. Vacuum the fan. If the fan is visible and accessible, cleaning it will help it move air across the condenser coil as designed. Dirt and dust, if allowed to accumulate on the fan blades, decreases airflow, affects balance and can contribute to early failure of the compressor.
6. Brush away stubborn dirt and dust. Use a narrow paint brush to gently remove stubborn dirt and dust from the coil and fan if able to get sufficient access.
7. Slide refrigerator back into position. Plug the refrigerator back into wall outlet. Arrange any water supply lines and power cords so that they will not be kinked or crushed by the refrigerator.
A devastating burglary, expensive electrical fire, or messy burst pipe is the last thing anyone wants to deal with — or pay for — during the holidays.
Be cautious this holiday season to ensure you don’t encounter any dangerous situations or lose any of your home’s value.
Here are six holiday safety tips to protect your home:
1. Avoid visible gift displays.
People have many new, high-value items wrapped up in their homes around the holidays that burglars can easily and quickly grab—causing potential damage to windows, doors, and a home’s interior and exterior in the process. Police are unlikely to track down a thief and find your gifts: about 87 percent of burglaries go unsolved because of a lack of witnesses and evidence.
Though it’s tempting to set up a picturesque holiday vignette of a Christmas tree surrounded by piles of gifts near your front window, the Los Angeles Police Department encourages people to put presents out of view from windows and doors. Better yet, keep expensive gifts hidden until you’re ready to give them.
2. Select a fresh tree and water it daily.
Christmas trees cause an average of 210 fires and $17.5 million in property damage a year. To avoid this, choose the freshest tree possible. The National Christmas Tree Association recommends running a branch through your fingers to check for signs of dryness. Do not buy a tree if its needles come off easily, its branches break, it has discolored foliage, it smells musty, or its bark is wrinkled.
After bringing your tree home and putting it in a stand, check its water level frequently to make sure it doesn’t go below the base of the tree—otherwise, your tree may begin to dry out. And remember any sources of heat, like tree lights, fireplaces, heating vents or sunlight from a window, will cause a tree to dry out more quickly.
3. Choose your lights carefully.
Electrical issues are behind a third of Christmas tree fires, and the majority of those fires involve decorative lights. Consumer Reports cautions to only use lights tested in a nationally-recognized laboratory, like Underwriters Laboratory (UL). Old lights, especially if they are uncertified or damaged, generally draw more power and are a major risk.
The best lights for Christmas trees are certified miniature lights that emit low heat. But no matter what lights you use, always inspect them for loose connections, broken or cracked sockets, and frayed or bare wires. And never leave a lit Christmas tree unmonitored — turn off the tree lights when you leave the house or go to bed.
4. Prevent outdoor light displays from overheating.
Though it’s easy to plug numerous strings of lights together to wrap around the roof, this can cause a major fire hazard. Overloading a single electrical outlet with too many lights will overdraw the power and cause overheating. This can trip the circuit breaker and start an electrical fire.
Prevent this from happening by never attaching more than three strands of lights together. Consider using LED lights, because they use less energy and don’t get as hot as traditional incandescent lights. And, if you’re hanging up lights outdoors, make sure to use ones that are certified for outdoor use.
5. Drain outdoor pipes and insulate indoor pipes.
During cold winter nights, the water in pipes can freeze and cause them to burst, which may cost up to $6,000 to repair. To avoid an expensive cleanup, take preventative action. Outdoor pipes like sprinkler lines, hose bibs, and swimming pool supply lines are the most likely to freeze. Before cold weather hits, drain the water from your sprinkler lines and swimming pool, remove outdoor hoses, and close the inside valve to outdoor hose bibs.
Unheated interior areas, like basements, garages, kitchen cabinets, crawl spaces and attics, are also at risk. Pipes in these areas need to be insulated with pipe sleeves, heat tape or heat cables that are certified to cover exposed pipes. The American Red Cross advises that even one-quarter inch of newspaper can provide insulation.
6. Never leave cooking food unattended.
Cooking mishaps cause nearly 72 percent of Thanksgiving Day fires, leading to $28 million in property loss. The number of kitchen fires on Thanksgiving is more than twice the amount of fires on other days of the year, and turkey fryers alone have caused $8 million in property damage.
The American Red Cross recommends cooks should never leave food unattended and avoid wearing loose-fitting clothing and long sleeves. Also, enforce a “kid-free zone,” use a timer, install a smoke alarm, and keep cooking areas free of items that can catch fire, like oven mitts and towels.
We wish you all a safe and festive holiday season!
Adapted from Property Casualty 360, December 2016.
They don’t build homes and furniture like they used to. Now, they burn faster. New technologies and product advancements are making us more efficient and more productive. But there is a cost, and that cost is risk. According to the National Fire Protection Association (NFPA), while the number of home fires that occur each year has fallen by nearly 50 percent since 1977, the total amount of resulting property damage (in dollars) is increasing.
Homes today burn an estimated eight times faster than in past decades. In fact, flashover, the point at which intense heat causes an entire room to become engulfed in flames, now occurs less than five minutes after a fire starts, whereas it used to take 30 minutes. This faster progression gives homeowners, firefighters and other first responders less time to react, creating significant hazards to safety and property.
Newer homes are constructed and furnished differently than in the past. Specifically:
If you have a client who is building or renovating a home, suggest that they take these additional precautions:
National Underwriter Property & Casualty, August 2016.