Building Tangible Margin: Thinking Ahead

As illustrated in “It Can Happen to Me,” disasters and emergencies are becoming commonplace and most people are unprepared. In the event of an emergency, what you think and do beforehand determines, to a large part, whether you are a blessing or a burden to those around you, especially those in your care. Having money in the bank and good insurance are nice, but tangible margin – that which feeds you, quenches your thirst and protects you – can be invaluable.

Before preparing, it is important to consider specific dangers that you could encounter where you live. These may be manmade or natural disasters. Here in Chicago, we face the prospect of blizzards, tornadoes, riots, attacks ranging from targeted bombings to NBC (nuclear, biological or chemical) attacks, nuclear and chemical plant accidents, floods, earthquakes, flu epidemics, etc. Mudslides, hurricanes, tsunamis and volcanoes are not big concerns. You needn’t be pessimistic, but realistically assess what threats you might face.

Now, if you have inherited wealth and have time to spend pursuing whatever you please, you might choose to prepare for each eventuality. First, you’ll need a lead-lined concrete safe room underground to protect you from nukes and tornadoes. Make sure you install bilge pumps to keep it from flooding and air filters to keep out the bird flu, anthrax and sarin gas. You’ll want a large arsenal to defend your years’ worth of food and your own well so you don’t have to drink the cholera-infested city water. You may need to evacuate at some point, too, so you should consider an armored Range Rover to take you to your fortified cabin in rural Wisconsin where you’ll live out your days on your private lake as the rest of the world comes down around you.

For the rest of us, I’m going to make suggestions based on modest means. Getting the essentials in place should not break the bank. It can be done in stages, and you can always upgrade down the line if you choose. If the choice is between a custom-made knife for $300 or a $30 knife and a week’s worth of MREs and water for your family, it’s no contest in my mind.

The recommendation has been that you should have three days’ worth of necessities to be ready for an emergency. The theory was that government services would not be out of commission any longer than that. If you could take care of yourself for three days, FEMA/National Guard/Red Cross/etc. would be there on day four with the aid you need. After the tragedy of Hurricane Katrina, I suggest that preparing for four days (96 hours) is the minimum and a week or more is a good idea.

Take the time to contemplate some possible scenarios you could encounter and the likelihood of each. In upcoming entries, we will look at steps you can take for sheltering in place and for evacuating.

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