Usually, folks don’t equate hurricane season with their credit cards or credit ratings, but for those who live in hurricane-prone areas, you can be sure it’s on their minds six months out of the year – hurricane season runs from June 1 to November 30 of every year. And ask any resident who’s been caught financially unprepared and you’ll hear all about the importance of covering all the bases.
Now that we’re a week into this year’s season, news comes that the predictions for this season have actually been increased. In fact, there were two named storms before the season ever began. While hurricane season might not directly affect everyone in the nation, Hurricane Katrina is proof that it indeed influences the financial sector as a whole.
Then and Now
While we generally steer clear of personal stories, there are those times when it’s just what’s needed to make a point. This writer was raised along the Mississippi Gulf Coast and during Hurricane Camille’s devastating landfall in 1969, I was exactly a year old. In the late 1960s, of course, there existed none of the technology that makes lives easier in a modern society. Making hotel reservations online was not an option; in fact, the internet as a whole wasn’t an option. If you wanted to make reservations, it meant a quick phone call and you weren’t even required to provide a credit card number. The faith folks had back then…
At any rate, it wouldn’t have mattered much as Hurricane Camille began to target the Biloxi-Gulfport area. If you hadn’t evacuated, odds are, you weren’t going to on that historical night. The banks had long since been closed in preparation for the storm and ATMs didn’t exist either. Families had either evacuated hours earlier and were fortunate enough to get a hotel in places further north or else they had traveled to family members further inland. These days, though, it’s much different.
Families are scattered around the nation and the world in ways that weren’t really feasible during the 1960s and while there thousands more hotels and hotel chains, there are also thousands more residents along the Gulf and east coasts of the United States. These days, folks begin making hotel reservations online before a storm ever even enters the Gulf. If the storm fizzles or takes aim elsewhere, they simply log into their Holiday Inn account and cancel the reservations. That’s certainly convenient, but the problem is, without a credit or debit card, making those online or even telephone reservations is not possible.
The Recession Effect
As we all know by now, the recession that began in 2008 has left millions of Americans with damaged credit. Whether it’s job losses, foreclosures or a series of bad months when payments weren’t made on time, credit ratings took a massive hit. This means there are more Americans without those necessary resources to hold a hotel room if a storm threatens. Not only that, but when a storm hits, it often results in widespread and long term power outages. This makes ATMs, DSL boxes, gas pumps and a host of other electricty-driven devices and equipment inaccessible. Clearly, there’s a need for both cash and credit during these emergencies.
Qualifying for Credit
The problem is many Americans haven’t quite picked up the pieces when it comes to their finances. They may not yet qualify for another credit card and in fact, many don’t qualify for a basic checking account. It’s during these times a prepaid debit card can be the right solution.
Most are accepted at all hotels, they work just like credit cards and most importantly, you can pull cash from an ATM before you head back to a storm damaged area. These financial tools have proved invaluable in times of emergencies, not to mention they’ve quickly become the first choice for millions of Americans. They’re great tools for helping young adults learn the nuances of smart financial decisions and they have come to serve as a more than ample solution for those with no access to traditional credit products.
Even the prestigious American Express company has entered the prepaid market and what it offers has heads turning. Card holders enjoy the same benefits as other AMEX members, including around the clock customer service, Roadside Assistance and a purchase protection plan.
There are no application fees, no annual fees, no credit checks and no APR since it’s a prepaid product. You’re guaranteed approval and those past credit problems play absolutely no role in the process. It’s a fine alternative to being caught off guard – whether it’s a hurricane or a flat tire.
While no one – not even the National Hurricane Center – can predict when and where the next category 5 hurricane will make landfall, what we can do is cover the bases so that when and if we’re threatened, we’re not left vulnerable by the lack of a strong financial plan.
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