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- There's nowhere completely safe from the climate crisis, and for many, it's raising housing costs.
- In places where homeowners insurance is hard to come by, going through an independent broker helps.
- You can save money and combat the climate crisis with tax credits for clean-energy solutions.
- This article is part of "Your Wallet on the Climate Crisis," a series exploring the crisis' financial impact and how people can plan. For more climate-action news, visit Insider's One Planet hub.
On November 8, 2018, LaJan Collins was walking home after a leisurely lunch with a neighbor when she noticed the smoke. At first, she didn't worry too much. Even though the wind was kicking up, the wildfire was still miles away from her home in Bell Canyon, California. She and her husband, Fred, had lived there for nearly three years, and a brush fire had yet to reach their neighborhood.
When LaJan arrived back at her five-bedroom Spanish revival home and flipped on the news, the early predictions reassured her, but she kept the television turned on anyway, just in case.
As they tracked the fire on the news throughout the afternoon and evening, Fred was less concerned than LaJan. When she said they needed to evacuate at 1 a.m., he suggested she stop overreacting. She refused. Her insistence saved their lives.
She saved family photo albums, important documents, and heirlooms, but the Collinses lost their home.
Nowhere is safe from climate change
They would spend the next few years packing their family of four into hotel rooms and tiny apartments as they tried to start over. When they finally finished rebuilding their Bell Canyon house, they decided to sell it rather than move back in. They couldn't start fresh at the site of one of the worst nights of their lives.
The Collinses moved to west Los Angeles, which is on the San Andreas Fault, still in the literal line of fire, and now, apparently, vulnerable to hurricanes. But as LaJan pointed out, if it wasn't fire, earthquake, or flood, it could as easily be a tornado somewhere else. In 2023, no one is safe from the climate crisis.
If you think about it too long, the science can be terrifying. But at an ever-increasing pace, climate change is becoming impossible to ignore, especially financially. The cost of food is rising due to poor growing conditions, and home insurance is becoming hard to get in areas with a higher risk of natural disasters. We can try to bury our heads in the sand and leave the worst effects of climate change to our grandchildren, but its financial impact has already arrived.
Climate-conscious tax credits can help with rising costs
Christopher Stroup, who lives in Santa Monica, California, is a certified financial planner and wealth advisor who regularly helps clients navigate climate concerns.
Stroup says there are several ways to combat the financial impact of the climate crisis. First up, do some comparison shopping of homeowners insurance companies. Instead of making a decision about insurance after 20 minutes of research and a talk with a charismatic salesperson, make sure to do your due diligence. When it comes to getting the best price on homeowners insurance, knowing your options is key. If getting insurance where you live is difficult, Stroup suggests going through an independent broker.
Second, Stroup says to look into state and federal programs that reward energy-conscious consumers. In Stroup's home state of California, the Golden State Rebate program provides rebates for energy-efficient air conditioners, smart thermostats, and more. On a federal level, the Residential Clean Energy Credit offers tax credits to people who have purchased clean-energy equipment such as solar-powered water heaters and solar panels. You can save money by switching to a more energy-efficient lifestyle, and there's a good chance you'll also be financially rewarded for it.
Stroup also suggests looking into private rebate programs. Electric companies, thermostat manufacturers, and many others offer discounts and rebates to save you money on the front and back end of energy-conscious upgrades.
Be prepared for things to get worse
Stroup also encourages expanding your emergency fund. Financial planners advise people to have at least three months' salary saved. Stroup suggests increasing this to six to 12 months. Stroup also says you should plan for ways to fireproof your home if you live in a brushfire area, board up your windows if a hurricane is on the way, and have an emergency kit packed and ready to go. Because while we can't plan for a natural disaster, we can prepare for one.
Finally, Stroup suggests using your finances to combat climate change. Don't support fossil fuel and other environmentally destructive companies. Make banking and investing choices based on the future you want for us all.
Stroup's advice has a theme of intentionality — know where your money is going, proactively prepare for disaster, seek out ways to save money on energy, and make sure you've found the absolute best deal on insurance available to you. And like LaJan Collins staying up late to track the fire even though everyone told her it would be fine, it's important to stay vigilant. We're all under the threat of climate change now, and sleeping on it won't solve anything.