It’s the middle of the night and you’re dreaming of a weekend in Paris when your peaceful dream is abruptly interrupted by the screech of a fire alarm. It takes you a second to smell it in the air but it’s unmistakable, something is burning. Now. You drop the floor and crawl to the door, as you were taught in elementary school, and slowly make your way down the stairs and out of your house.
That’s what you imagine you’d do in the event of a house fire (adjust for checking on family members) but chances are, in a minor fire, you’d probably try to save something and, while that would be a mistake, wouldn’t be unreasonable. You’d grab your cell phone, probably your wallet if it was nearby, and then run out the door. If you had more time, next on the list would probably be important financial documents like your birth certificates, social security cards, passports, etc.
That package is your financial bug out bag. A year ago, I called it a financial snatch file  but the idea is the same. If you experience an emergency that gives you a few extra minutes to escape, such as your neighbor’s house being on fire (if it’s yours, just get out… you can replace those documents, you can’t replace your life), you want to be able to get out with important documents. This is what you need to do.
A typical bug-out bag  is a kit you can grab that has all the items you’d need to survive for 72 hours. It’s sometimes called a GO Bag or a 72-hour kit but the idea is that when you really really really need to go, you don’t have time to pack what you need. Well, we’re here to extend that idea to your finances because second to actual survival is financial survival.
Your bug-out bag should have two major types of items:
- Financial supplies – These are items that you’ll need in the next 72 hours such as emergency cash, paper currency and coins, as well as spare credit cards and other financial instruments.
- Financial and identity records – These are items that you will want to keep because leaving them behind may leave you financial vulnerable. These would include your passports, your birth certificates, car and home deeds, etc.
The first step in constructing your financial bug-out bag has nothing to do with the bag itself. You should always store a copy of your important documents outside your home. The common scenario of a house file illustrates the importance of off-site storage. If your house is on fire and you have a copy of your documents somewhere else, you won’t be tempted to risk your life to get to your bug out bag. If you didn’t have a copy stored elsewhere, you might be tempted, which is dangerous enough.
I electronically scan all important documents and store them in several locations, one of which is outside my home. You can get USB flash drives that have way more storage than you’ll need to hold PDFs of important documents. You can encrypt it and leave it with a trusted friend, as you would with house keys, or stick it in a safe deposit box  at your bank.
Building Your Financial Bug Out Bag
Once you’ve setup off-site storage, here’s what you should put in your physical financial bug out bag:
- Cash – Whatever you feel comfortable with, you’ll want it to cover 72 hours of expenses.
- Expired/Active Passports – In the event you need identification, a passport is accepted almost everywhere as a form of ID.
- Social Security Card, Birth Certificate – Don’t keep this in your wallet or on your person unless you know you need it.
- Loan Documents – You will probably have electronic versions of this already but it’s nice to have the paper versions, especially if you can’t get access to the electronic version.
- Insurance Documents: In the event of a house fire, you’ll want to have this information handy so you can call your agent immediately.
- Deeds – The title to your car, house, and any other major assets.
- Account Listing – A list of all of your credit card, brokerage, deposit, and other financial accounts along with customer service numbers. This will give you a way to keep track of all your financial accounts in case you lose other documentation.
Alternatively, you can purchase a safe with fire resistance to hold your documents so you don’t need to grab them in the event of a fire. Safes are rated by the Underwriters Laboratories (UL) and the National Fire Protection Association to withstand fire four different ways – fire endurance, fire and impact, explosion, and combined explosion and impact. The rating is a measure of how long the safe can maintain a safe temperature over the time period, so a one-hour rated product for paper means it won’t exceed 350°F within an hour of testing (in a 1700°F furnace). If you do store documents in a fire safe, be sure not to wrap them in plastic or something that can melt easily.
This kit won’t save you from a zombie apocalypse, but it should come in handy should you find yourself in a less fantastic predicament.
Did I miss anything?
(Photo: paulk )