How do you create a home inventory?

First, walk around and record a video of the contents in your home. Get close up to expensive electronics, and try to capture as much information as possible. It will take some time to compile a proper inventory, so until then you can use this video as a substitute.    
 
Next, you need to decide how you will store your home inventory. You can use a tool like the Know Your Stuff app from the Insurance Information Institute or put together a simple Microsoft Excel spreadsheet.  
 
Next, walk through every room of your house, and take plenty of pictures. Take photographs of the room, of expensive items in the room and any identifying information such as model numbers and serial numbers.  
 
Go back to your tool and enter in as much information about each item as possible. Then store it in a safe place, such as in a Dropbox account or folder in your email, so that it can't be damaged or stolen.
Keep the inventory up to date.  
 
If you move items from room to room, update your inventory. If you recently received some gifts because of the holidays or a birthday, update your inventory. It's important to update it at least once a year, and more often if you receive or purchase expensive items. An outdated home inventory is better than no inventory, but you might as well spend a little time to keep your list up to date, which could relieve some future stress if you come to need the list.  
 
Update your insurance coverage if necessary. Your insurance policy has a limit on how much of your personal property it will cover. If you find that the contents of your home are particularly valuable, you may want to increase your coverage so that you are protected in the event of a theft or fire.  
 
Note that some items are not covered or are only covered with low limits under a standard insurance policy. For example, many insurance policies have limits on items such as collectibles and jewelry. You will want to get separate insurance riders for those items.

A home inventory is a very inexpensive and easy way to save you a headache and precious time, so do yourself a favor and start one today.