finance

Redemption: Making a Financial Comeback

Redemption. Revival. Comeback. The Gaff family lost everything imaginable in a wildfire just five years ago. Now in 2021, they share a few effective financial tips that helped get their family back on their feet and move forward.

Source: WJHL News 11 Station-Tennessee

When I think of a redemption, I envision a movie that involves the main character going through such turmoil and hardship, only for the viewers to see his/her comeback at the end of the storyline. We all love a good comeback story because it genuinely is a “feel good” moment to be able to watch people overcome obstacles.

This month actually marks the five year anniversary of the Gatlinburg wildfires in Tennessee, where according to WJHL News, over 17,000 acres were destroyed. My friend and fellow Financial Coach colleague, Brett Gaff, unfortunately lost his home to the wildfires back in November 2016. In my recent episode of the Two Sense Money podcast, I had the pleasure to interview Brett about the fires and how his family was able to overcome this absolute tragedy.

A few key takeaways that Brett Gaff discussed throughout his story but I really felt the need to highlight are:

  1. Review all insurance policies you have, ESPECIALLY your Homeowners/Renters policy– Did you know that making enhancements to your home without alerting your insurance company can actually hurt you financially? The insurance company has an amount listed on your policy to cover a “rebuild” of your home in the event your home is lost in a fire, natural disaster, etc. If the insurance company is unaware of any modifications you have made, they are only going to give you up to the amount that was previously listed as the “rebuild estimate”. Another important factor to point out is: Make sure you have the right policy! Unfortunately, Brett and his family only had a Landlord’s policy at the time of the tragic fires, which ended up not covering their furnishings and belongings. They were actually in the middle of transitioning their policy to a Homeowners policy when the fires happened, so the coverages were drastically different. If you are a renter and do not have Renters insurance, please begin looking into obtaining a policy sooner rather than later. Having Renters insurance can help you cover your personal belongings in the event of a disaster. Make sure to protect your valuables!
  2. Have a “Rainy Day” fund also known as an “Emergency Fund”- All too often do I talk to individuals who regret not having a savings in place for emergencies. Any time I consult with clients, I always recommend having a minimum of 3-6 months worth of expenses saved. To break it down a bit further, what it means to have expenses saved is essentially- How much it costs for you to afford the essentials each month. For example, if your household expenses (the average it takes to keep the roof over your head plus utilities and food/water) are $2000 a month, then a 6 month emergency fund would be $12,000. These emergency funds are essential because if you experience a job loss or tragic event that impacts your income, you have this special savings specifically allotted for your living expenses.
  3. Create a list of your belongings and have a safe for your important documents- This honestly is something everyone needs to do regardless of their situation. A list of your belongings/valuables really comes in handy for your insurance policy in the event you need to replace your items. Also, think of a situation where your home is robbed and under the extreme emotions of going through that, you are not able to remember every little thing that the robber(s) could have taken. Another scenario is for your will, which many of us tend to put off until we feel it is absolutely necessary to have. In your will, it is good to include your valuables and any items you feel are especially important to you and your loved ones. Creating a list of your valuables and belongings can have multiple uses which are all equally as important. On another note, PLEASE have a safe in your home. Regardless if it is a big safe that you need to drill into the floor or one that you can simply place in an accessible area, this needs to hold your vital documents that you can grab and go if need be. Important documents to place in a safe are: Birth Certificates, Social Security Cards, insurance policies, extra keys for your cars/homes, any cash you may have stashed away, Wills, legal documents, etc.

All in all, being prepared for the unexpected is very important, even thought we may not always be 100% prepared. If we can control our part in the situation and be as prepared as we possibly can be, this will allow us to take additional stresses off our own plates when a situation arises.

If you would like to listen to the interview with Brett Gaff and hear about his comeback story, please click below! Thanks for reading and I look forward to providing you some more great content! Happy Holidays!

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