Six Effects of Climate Change on Your Finances

Temperatures around the world go up as the climate changes. This situation made it difficult to predict the future.

While information about global warming is readily available, the changes in the climate of the Earth are happening too fast. This made it difficult for scientists to make precise predictions about the future. It is also not easy to make accurate predictions on the weather in the coming weeks. Due to this, it is also difficult to predict weather patterns in the coming years.

Let us take a look at six possible scenarios on what is in store for us when it comes to our finances in the future.

1. Water costs will go up

water-pollutionWater is the Earth’s most precious resource. Finding clean water will become more difficult in the next five decades, according to scientists. This situation is based on current climate models. It is also based on the systems used in collection and storing of water. Around fifty percent of the entire population is dependent on groundwater for their personal consumption. The National Geographic indicates that urban demand for groundwater may go up by fifty-five percent by 2050. Groundwater is renewed through rain.

Since rainfall goes up due to global warming, people may think our groundwater supply will be renewed easily. But, this is not the case. Groundwater supplies go up gradually through steady rainfall and the melting of the snowpack. Current models show that snowfall in the northern hemisphere will go down in the next century. The National Geographic estimates this decline to be from ten percent to thirty percent. Increases in rainfall through torrential rains during the monsoon season cannot be absorbed and will only result to flooding.

The Physicians for Social Responsibility and the Union of Concerned Scientists both say that higher temperatures can affect water quality. Freshwater reserves in coastal areas may be affected by rising seawater. On the other hand, areas affected by droughts will see more pollutants in their freshwater reserves. This situation can result to possible health issues among the population.

Many towns will experience millions in damages due to floods caused by excess storm water. Seattle experienced this in February 2017. This situation can result to expensive backups. In the case of the treatment plant in Seattle, it caused a voluminous amount of raw sewage to pour into the Puget Sound. These situations are expected to make it more expensive to get clean water in the next fifty years or so.

To get pure water, you may need a home water treatment. For example, you can buy a reverse osmosis system or other types of water filters to purify water at home.

2. Energy expenses will go up

solar-power-generatorFracking is a method of using pressurized water in taking out gas and oil from rock shale. North America used this method to produce inexpensive natural gas and oil. But, freshwater supplies will go down due to climate change. Due to this, water expenses will go up and make it expensive to use fracking in producing oil and gas.

The situation will also affect the other ways of generating power. Water flow in rivers will go down due to changes in rainfall patterns. It will also be affected by higher evaporation rates. Due to this, rivers will have less flowing water for hydroelectric dams. Water is also used in cooling down nuclear power plants and coal plants. A lower water supply will cause brownouts, particularly during peak power hours.

But, developments in green technology, such as wind and solar energy production may provide some relief. For example, there ae many solar powerd lights you can choooe for outdoor lighting, like solar deck lights, solar path lights, solar post lights, solar flood lights, etc. In addition, efforts have been exerted to produce rechargeable batteries designed for storing electricity at home. Using these technologies and microgrids can reduce issues linked to the old utilities infrastructure of the United States. Microgrids are local energy grids that allow areas to disconnect from the main power grid.

3. Food expenses will go up

dexbaby-Dex-Baby-Food-ProcessorWarm climates offer some advantages and disadvantages to food production. Crops like warm weather and high carbon dioxide levels. It also results to bigger yields. But, it may also cause new pests and diseases to come out. These pests and diseases may flourish in these conditions. Crop yields are not the only basis for food prices. Due to this, it is not easy to predict the cost of food in the future.

The National Geographic says yields of some crops may go up. But, there may be a considerable drop in others. Scientists have predicted the following:

  • The Midwestern United States may see a lower corn yield by up to twenty percent while Brazil will see a sixteen percent yield reduction. When the price of corn and basic cereals go up together with water costs, meat production will also become expensive.
  • While potato production in northern Europe may go up, droughts may plague the southern part of the continent.
  • Industrial agriculture may go up in eastern and western Africa, but there will be lesser farmable land in India and China.

Supply of fresh vegetables and fruits in the United States may also go down due to global warming. This can cause prices to go up. Most of the fresh produce in the United States come from California. These produce include tomatoes, citrus fruit, plums, broccoli, artichokes, and nuts. More droughts and heat waves due to climate change may affect the farmlands of California.

Increasing carbon dioxide levels will cause the acidification of the oceans. This can kill some fish species, such as salmon. Due to this, the supply of seafood will go down and it will become more expensive.

4. Value of real estate in flood-prone areas will go down

real-estateWhen the oceans and the atmosphere become warmer, it can cause stronger storms and hurricanes from the ocean. More storms and hurricanes may also happen.

These storms along with rising sea levels can cause the value of properties along the coastal areas to go down in the next fifty to a hundred years. The National Ocean Service says that 39 percent of the people in the United States are living in coastal counties in 2010. This will go up by eight percent by 2020. People with properties along the coast have to deal with the risk of rising sea levels as well as increasing costs of maintaining their properties, particularly when it comes to flood insurance. Premiums and deductibles are expected to go up in areas directly affected by floods caused by climate change.

The real estate industry in the United States took time to react to predictions associated with climate change. This is mainly due to the fact that North America has not experienced any damage caused by climate change. It may also be due to the fact that around sixty percent of Americans did not think they were at risk from the dangers of climate change, based on research from the Program of Climate Change Communication of Yale University. But, there are already changes caused by global warming. Data from the New York Times indicates a 7.6-percent decline in home sales in areas with a high risk of flooding in the Miami-Dade County. This comes as home sales went up by in the United States.

5. Cost of owning a home will go up

houseLocation is the most important factor when it comes to buying a home according to real estate agents. The mantra of real estate agents is now true more than ever. In the past, homeowners used to consider the local school district quality, amenities available in the neighborhood, and safety when they bought houses. But, these days they think about possible flooding in the area or the risk of forest fires in their neighborhood. These considerations point out any risks in the area or a much higher cost of acquiring the property.

Your insurance and mortgage options are affected when you buy properties in areas affected by climate change. It is possible for you to pay a premium for living in these areas. For instance, homeowners living in fire-prone areas will have to pay an annual fee to alleviate the cost of firefighting. This proposal was already made in the Washington State.

6. Heath care expenses will go up

Bangkok and Beijing residents are aware of the effects of air pollution on their health. A polluted atmosphere can cause a number of health issues such as asthma and emphysema. This type of atmosphere is one of the major causes of climate change.

Plants also produce more pollen due to the warm weather and high carbon dioxide levels. This situation is unhealthy for people suffering from allergies.

When the climate is warm and wet, it can result to the spread of insects, such as mosquitoes. These insects can spread deadly diseases. The bark beetle is also destroying huge areas of forests in Canada and western United States. This has resulted to more dead wood that contributes to bigger and more dangerous forest fires, particularly during the summer. The situation also makes it more difficult for people suffering from asthma and other pulmonary diseases.

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