I bought this place in March of this year. In June, my neighbor's bathroom pipe broke. I was forced to move out to a temporary home and start the restoration process. The contractor told me that the process should take four to six weeks. I finally moved back in September.

After parting ways with my ex, I moved to a different city and started rebuilding my life. I rented a few places but had so many problems with the landlords. Coming out of my divorce, having a place of my own to plant my roots became more important to me than ever before.

This water incident happened, and it truly tossed me out of my element. I dealt with many parties and vendors in such a rush because of mold. The process was very stressful and lasted longer than expected, but the result was gratifying. My place is now reborn. Along the way, I've learned so much about insurance claim settlement, the restoration process, and beyond.

What helped me navigate through this process smoothly included:

-A good-sized emergency fund

-Good insurance coverage

-A good credit score

-Being organized with my income and expenses and documents

Emergency Fund:

The importance of having a sizable emergency fund is proven in my case. My incident happened on a Friday evening. I couldn't reach any insurance representative that weekend to start the claim process but I needed to have the water mitigation company come in ASAP to avoid mold. With the help of that emergency fund, I was able to afford the relocation cost, water mitigation, and part of the restoration process out of pocket before receiving any reimbursement checks from the insurance.

Credit Score:

Although I had insurance, this doesn’t always cover the entire cost. I exhausted my emergency fund, so I needed to dip into my credit card. I worked with my bank to increase my credit limit, and my credit score helped me access higher credit limits and a better rate. Maintaining a high credit score and occasionally checking your credit report for accuracy are highly recommended.

Good Insurance Coverage:

Saving costs on insurance isn't always the best thing to do. It might help your wallet now, but it also might end up hurting you when you need to make a claim. Urgent relocation to temporary rentals, repairs, and replacement costs could get very expensive. Although my neighbor's insurance took the main responsibility, I still had totap into my insurance coverage. It is crucial to take an inventory of your personal belongings, shop around, compare policies from different providers, and maximize your insurance coverage limits when choosing insurance to ensure any reimbursements will cover your needs.

Staying Organized

Knowing my income and expenses helped me with my cash flow planning. I needed to cut back on my expenses to afford these high replacement costs. I could quickly pinpoint the “want” expenses I needed to cut back on as well as the “need” expenses I had to keep paying. Staying organized with my documents and invoices helped me deal with the insurance company and other parties.

Life will always have its twists and turns. Sometimes things are beyond our control and the only thing we can control is our reaction and our readiness ahead of time. By being financially prepared, you can avoid some of the stress of the “unknowns” and can feel more confident in your choices as you navigate through life’s many surprises.

Welcome to homeownership!

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