Thursday, December 22, 2016

Here’s how your finances will be impacted by climate change

I suggest reading the whole article at the following link:

By Kari Paul
Dec. 20, 2016

Our planet is warming, putting at risk not only our physical well-being, but our wallets.

2016 is shaping up to be the hottest year on record and scientists say global temperatures may rise by 7 degrees Fahrenheit before the end of the 21st century. As climate change escalates, cities are building sea walls, seeking new water sources for drought-stricken land, and storm-proofing their infrastructure in preparation. But while impending environmental impact of rising temperatures may be the most tangible, the often-overlooked effects on our pocketbooks may be just as worrisome, according to David Stookey, author of new book “Climate-Proof Your Personal Finances” published the Savvy Families Institute, an organization he heads that is based in Rhode Island.

“The physical problems are going to affect relatively few people in America — a much broader number are going to experience these problems financially,” he said. “The physical risks are nothing compared with the financial risks.” For this generation, at least.


The speed and degree to with climate change will affect us — and what we will do to slow it — is not fully known, but we can begin taking measures now to financially prepare.

1. Re-evaluate your budget

Climate change will send food, energy, and water costs soaring, and savvy consumers should adjust their home budgets accordingly, according to the Brookings Institution, a research think tank in Washington, D.C. Incomes are expected to shrink by 36% by 2100 due to climate change, and millennials will bear the brunt of the economic effects.

Rising temperatures, the erosion of topsoil in farming states, and erratic weather events are expected to drive food costs up between 3% and 84% by 2050. Consider cutting back on resource-intensive food like beef and other animal products as well as buying produce from local farms to keep costs down.

Impending water shortages can affect the costs of natural gas and even sustainable energy in coming years. Consumers should weatherize their home to decrease how much heat leaves in the winter and how much heat comes in during the summer and switch to renewable energy sources like wind, says Stookey. Face these potential financial troubles head on by making a budget that accounts for a percentage rise in costs each year due to climate change — Stookey’s website, offers a sample template for the average family home.

A 21-year-old college student graduating in 2015 is expected to lose $126,000 in lifetime income due to climate change and the generation as a whole is expected to lose $8.8 trillion in lifetime income, a study from environmental advocacy organization NextGen Climate found. This decrease is due to a number of climate change-related economic burdens including stagnant wages and lack of well-paying jobs and potential recession.

2. Straighten out your insurance

As climate change transforms our environment, it will raise a number of new issues to take into account when choosing health insurance.


3. Pick a climate-safe job

Changing weather will have major effects on a number of industries: Agriculture will be damaged by drought and high temperatures and commercial fishing will be negatively impacted by rising sea levels. While warming may shrink some industries, others will remain stable or even experience a boost. College students and soon-to-be graduates may want to choose a career path that is climate-proof.


4. Warming-proof your investments


5. Climate-proof your home

Most standard home insurance policies don’t cover flood damage, according to the Insurance Information Institute, a nonprofit funded by the industry.


6. Consider making a move

Many of these problems can be avoided for the most part by moving to a less vulnerable or more climate-prepared city.

The most important thing, Stoo
key said, is to adapt. “The effects of global warming we feel are going to be highly local — one town could be completely immune and its next door neighbor will be in serious trouble,” he said. “People need to start planning for the risks.”

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