Create a home inventory and sail smoothly through any disaster that comes your way

Michele never really thought a home inventory would help her...but it did. Following advice from parents, she put together a list of all the items she owned -- things like TVs, microwave, DVD player, cameras, and jewelry never dreaming she would ever really need it. Imagine her unpleasant surprise when she came home from work to discover thieves had ransacked her home and stolen everything valuable she ever owned.

Now imagine her pleasant surprise when police were able to recover some of her stolen items because she compiled a home inventory. Imagine even more surprise when her insurance company settled her claim in record time because she conveniently listed everything of value.

Learn how a home inventory system helps you recover stolen items, file insurance claims, verify losses for income tax returns, and save money by buying the correct amount of insurance.

Take stock

Over the years, you accumulate 'stuff'. Unless you move or some sort of disaster strikes, you don't realize how much stuff you own -- until it's gone. The best way to protect against loss is to do a home inventory. Putting together a home inventory is a bit of a pain but one worth the effort. And with a little planning, you'll be finished before you know it.

First, get organized. Decide how to categorize your possessions. Choose to do this room by room or by categories like electronics, furniture, or jewelry. Or choose only to make an inventory of your most expensive items. It's up to you.

Next, decide how to record your information. You can do it the old- fashioned way and write the information down in a notebook, or put your electronics to use. Use a digital camera to take a picture of the item and a close-up of the serial number of each item. Save the information to a flash drive.

Consider using a video camera to record your home inventory. Simple turn it on and film as you walk through each room in your home. Talk about and read off serial numbers for each item.

Secure your information

Once you have your inventory recorded, decide what to do with it to be sure it stays safe. After all, you don't want to keep it in your house. You risk your information being destroyed in the event of a fire, tornado or flood.

One option is to make more than one copy and keep them at two different places. You could ask a reliable relative to keep one record and put the other in a safe deposit box at your bank. Or you could keep one copy locked up in a fireproof safe at home and lock the other up in a deposit bank.

A home inventory is priceless information when it comes to settling insurance claims, verifying losses on tax returns, and buying the correct amount of insurance. Creating a home inventory isn't difficult -- it's one of those necessary chores. But once you have it, you'll be so glad you did.