Don't wait to make a home inventory

Imagine that all your belongings are destroyed in a house fire. Thankfully, you have insurance. But to file a claim and get reimbursed, you have to make a list of everything you lost. How many of your belongings would you be able to remember?

I tried it on a smaller scale, listing everything I could think of in my home office from memory. I came up with 51 items. Not bad, I thought — but once I returned to the room, I discovered another 25 things I'd missed.

To ensure your claim payout doesn't fall short, consider creating a survey of your belongings, often called a home inventory.

"Is it hard to [make an inventory] now? Yeah," says Katherine Navarro Wong, a State Farm agency owner in Santa Rosa, Calif. "But after you've lost everything, it's really hard."

Because you've already done most of the work, having a home inventory in place makes it easier and quicker to file your claim, Wong says. "You'll get your money faster."

Putting together your inventory can also help you make sure you have enough insurance coverage. You might not realize just how much your stuff is worth until you start documenting it all, Wong says. Then, if you discover that your personal property coverage isn't enough, you'll have time to increase your limit before disaster strikes.

How to create a home inventory

One is to walk around a room making a video with your smartphone. Narrate as you go and zoom in on the labels of high-value items. Don't forget to pull out dresser drawers and open cabinet doors to show what's inside.

Taking photos instead of video is another option. Many home inventory apps allow you to upload images and information about each item, such as the serial number or date of purchase.

You can also create a spreadsheet, either from scratch or by downloading a template off the web. For example, United Policyholders, a consumer advocacy group, offers a comprehensive inventory spreadsheet with hundreds of suggested items divided by room.

Whatever method you choose, make sure your home inventory is stored somewhere outside of your house, such as in the cloud or a safe deposit box at the bank. Having an inventory won't do you any good if the computer it's on burns up in a fire.

Your insurance agent may even be willing to keep a copy of your inventory, Wong says.