superstorm sandy, financial disaster, financial crisis, budgetA disaster such as Superstorm Sandy, which just marked its one year anniversary, can have a long-term impact. Many Sandy victims are still in the process of rebuilding their homes and their lives. And if they were already on shaky financial ground when the storm hit, their recovery could be even tougher.

You can help prevent a financial crisis in your future by learning 7 mistakes people commonly make after a disaster and how to fix them, taken from my book “50 Simple Steps You Can Take to Disaster-Proof Your Finances.”

1. Procrastinating

During a financial crisis it’s important to do certain things as quickly as possible. Our instinct is to take cover and protect ourselves, but that can wreak havoc on our financial health. Instead, try to gather all of your energy and force yourself to take care of the financial basics. If you don’t, you’ll end up dealing with the long-term repercussions of your inaction.

2. Being Disorganized

disorganized, financial crisis, financial disaster, budgetMany people find that once they get themselves organized, they’re simply not able to maintain what they’ve created. Although my father always joked that a clean desk was the sign of a sick mind, it’s better to be organized. Once a crisis erupts, you’ll want to know where all of your documents are as quickly as possible. Develop a plan to maintain your files and contact lists and stick with it.

3. Moving Too Quickly

When you’ve lost it all, you may want to just walk away. Many people do this after a crisis erupts, only to be sorry a year later that they’ve sold their home or business and moved across the country. You can’t run away from your problems, you can only solve them. If you must sell your home to make ends meet, then sell it. But if you can afford to keep it for a year after your financial crisis, try to do that. You may change your mind about “chucking it all” in that time and will have left your options open.

4. Trusting the Wrong People

shady contractorScam operators and con artists come out of the woodwork  looking for victims. In the aftermath of a crisis, you’re most vulnerable to their sugarcoated promises. When your judgment is impaired, it can also lead you to trust people who, though they offer a legitimate service, may not be particularly good at it: such as  the shady contractor who wants payment upfront or in cash. Before you hand your hard-earned money over to anybody, do your homework and check them out.

5. Not Paying Your Bills

Credit card, utility and car companies don’t really care how bad a day you’re having. They do care that the bills they send are paid promptly. Don’t get so overwhelmed by your personal crisis that you forget to pay your bills. If you do that, you’ll destroy your credit history, which will make it more difficult to make a major purchase or refinance your home loan down the line.

6. Underinsuring Your Assets

insurance policy, financial disaster, budgetOften after a financial crisis we forget to update our remaining insurance policies.  If your house was destroyed in a fire or hurricane, you may need a new homeowner’s policy after the home is rebuilt. Take a look at your different policies and try to figure out what kind of insurance is missing. Then plug the gap.

7. Saving the House at the Expense of Everything Else

A very wise real estate agent (okay, it’s my mother, Susanne—one of the best real estate agents in Chicago) once told me that a house is a house, but a home is where your heart is. I’ve taken that to mean that a house is nothing more than four walls, a ceiling, a floor and some paint. It becomes a home when you and your loved ones move in. Don’t become so attached to your house that selling it becomes unthinkable—even if selling it would solve a serious financial crisis. As long as you take your family with you, almost any house can be a welcoming home.

Have you ever made any financial mistakes after a disaster?