Hurricane Ian reminds us that the question of how to best prepare for the risks of where we live in retirement is even more important than planning for how much retirement will cost.
Hurricane Ian reminds us that the question of how to best prepare for the risks of where we live in retirement is even more important than planning for how much retirement will cost.
Planning and living in retirement requires anticipating and managing risk. Markets rise and fall requiring us to adjust investment strategies, spending habits – or both. Chronic health conditions developed over decades can threaten personal health, and the wellbeing of loved ones, but the impacts may be managed with healthy behaviors and early intervention.
Few of us, however, think of our choice of where to live in retirement as a calculated risk. Despite the popular imagery of retirement as a life stage filled with bike rides, beach walks, golf greens, and even pickle ball, Hurricane Ian smashing into Florida’s Gulf Coast reminds everyone that choosing where to live in retirement includes anticipating the multidimensional risks of extreme weather and other natural events that everyone faces in every region.
Here are just three risk factors to consider:
Living where major climate events are common requires additional financial planning. Repairing or replacing a home after a major event is a significant shock to any retirement portfolio. How many of us have a rainy day fund, that is really for a rainy day? For example, temporary relocation costs, transportation, hotel, home rental, etc., resulting from an hurricane evacuation order or from a collapsed snow laden roof.
Insurance costs may increase after a significant storm or wildfire. Changing weather patterns, or rezoning of flood and fire zones, may dramatically increase insurance costs.
