So you want to help the folks who are suffering from Hurricane Katrina. What if you could do that and make money too? You might not think that is possible, but it is, and it is very easy to do.
The Gulf Coast will need a lot of money to rebuild. Not just public tax dollars, but also private investment. Much of this private investment money will come from banks. To help support this process of private investment, you, the private citizen, can lend money to the backs involved in the recovery effort. You do this by buying certificates of deposit in Gulf Coast banks.
CDs, or certificates of deposit, are bank accounts that you agree not to take money out of for a specific length of time. You can create CDs for 7 days, 1 month, 3 months, 6 months, 1 year, or even longer at most banks. When the time period expires, the bank adds the interest you have earned to your initial deposit, and then asks you if you want to renew your CD for another period of time. Say yes, and the bank puts the money in a renewed CD account. Say no, and it returns your initial investment, plus your interest.
CD interest rates are pretty good right now. Most 1 year certificates are going for about 4%, which means for every $1000 you leave with the bank you will get $40 back after a year.
Banks use CD deposits to make loans to clients. If lots of people buy CDs, the bank has more money to lend, and can charge lower interest rates. If not many people buy CDs, interest rates tend to rise and banks end up turning many borrowers away.
The goal, if you want to help storm victims, is to buy a CD from a bank that has lots of branches in storm ravaged areas. If you buy from a bank based outside of the Gulf Coast, most of your money will go elsewhere. For Mississippians, I would suggest Trustmark Bank. For Lousisiana and New Orleans, try Gulf Coast Bank and Whitney Bank.
This same technique could work for any disaster region. Just look for a local bank in the affected area, and buy a CD from them. You will be helping out, and it won't cost you any money to do it.