Financial resilience is the ability of a local government to be resistant to or bounce back from financial vulnerabilities generated from external shocks. In this chapter, tools and strategies local governments can take to prepare financially for less frequent natural disaster events are presented. Strategies for measuring the changing risk for these disaster events are identified. An approach is then presented for measuring the expected financial loss from these disasters and how local governments can use these expected losses to evaluate their local government’s fiscal health. Finally, strategies are given to address fiscal health shortfalls when incorporating disaster risk.