Make sure you're prepared financially for disaster

Most people will experience some kind of catastrophe, either affecting themselves or a loved one, during their lifetime. Whether it's a sudden accident, sickness, property damage, or some other disaster, these unexpected events can create unnecessary financial stress if you don't have some planning in place.

When the right plans are in place, it can lessen the financial impact and better protect you and your family members.

Make sure you can access savings during a catastrophe

You should have all sources of income, including paychecks, pensions, social security and other benefit payments set up for direct deposit. This way your cash flow is less likely to be disrupted. It's also a good idea to have payments of important obligations, like home mortgage and car loans directly deducted from a bank account for similar reasons.

If you have non-retirement investment accounts, make sure to activate a debit card or checkbook that is linked to the account. Most major brokerage firms provide this feature with their accounts. Also, link your brokerage or mutual funds account to your bank account for online or telephone transfers. This will give you the ability to access your cash and transfer money to your bank account in the event you need to do so quickly.

It's important to have a list of all retirement and investment account numbers and explain to other family members how to access those accounts in the event they need the money and you are not available. Keep a list of all account numbers, access phone numbers, and website addresses together with your most recent statements. Of course, keep these in a safe place but make sure another member of your household knows where everything is located.

Establish a back-up plan for credit

During a catastrophe, it's important to have several financial options for financial flexibility. If you own a home, establish a home equity line of credit or expand an existing one. Get an extra credit card, or extend your credit limits on an existing card. If your only credit is jointly titled, get a credit card of your own. In short, establish or expand your access to credit that is ready to be used if you or your family ever needs to do so.

Designate a safe places to store documents

Keep insurance policies, wills, trusts, and birth and marriage certificates, passports and other hard to replace documents in a fireproof safe box. Also, keep a backup copy of financial records here.

You can use a safe deposit box for valuable and irreplaceable documents and items. But do not keep the only copy of your will here. Access to a safe deposit box may be delayed because after a death notice is public, these boxes are sealed until the court appoints a representative who can open it.

Write a will and consider setting up trusts

Having a will and trust is a critical part of creating a financial safety net for your loved ones. Without these documents, your survivors are left without your personal directions and your state laws will specify how and to whom assets are given.

In a will it is extremely important to appoint a guardian and contingent guardian for any minor children. Also, include a trust provision that will hold and manage any assets that will go to minor children.

It is important to know what your beneficiary designations are and which accounts they apply to so that the designations are consistent with your wishes. These apply to life insurance, retirement plans, IRA's and annuities.

Naming a minor child as a contingent beneficiary could be a mistake, especially if you've taken the time to write a will. Instead, designate your estate or trust as the contingent or second beneficiary so that the trust receives the benefits and the children are provided for according to the terms in the trust.

Here are a few important points to keep in mind:

• Make sure to keep the information on beneficiaries up to date, including current names, addresses, Social Security numbers and dates of birth.

• Be clear when you name beneficiaries. If one of your beneficiaries has a common name, having the information above will help to ensure the right person gets the assets you're designating.

• Let your beneficiaries know they are named on your insurance or retirement accounts and let them know the name of the insurance or financial company. This will make the process easier for them to track things down in the event that you pass away unexpectedly.