Smart Money Podcast: The Cost of Climate Change: The Big Picture

Welcome to NerdWallet’s Smart Money podcast, where we answer your real-world money questions.

This week’s episode kicks off our nerdy deep dive into climate change and money.

Check out this episode on either of these platforms:

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Our take

How do you think climate change is affecting you? Is it the depressing media coverage? Frequent “once-in-a-century” weather? What about your money?

The reality is that climate change is already affecting your finances, and it’s happening in ways you might not be aware of. Our latest nerdy deep dive looks at the intersection of climate change and personal finance, and we’re kicking off the first episode by taking a broader look at how climate change affects our money, on a global level and as individuals.

In this episode, NerdWallet Insurance editor Caitlin Constantine talks with banking Nerd Spencer Tierney about his reporting into climate change and personal finance, which includes a 2021 report from the Federal Reserve that describes the wide-ranging macroeconomic impacts of climate change and a White House estimate that puts damages from climate change in the U.S. at about $120 billion a year. Climate change is also making groceries and energy more expensive, and it is expected to do the same for health costs.

With this relentless drumbeat of negative climate news, it’s not surprising to learn that climate change is not only impacting our finances, it’s also affecting our mental health. And as listeners of the podcast know, our money behaviors are deeply intertwined with how we feel and think about the world. Therapists report seeing an increase in patients dealing with “eco-anxiety.” And climate “doomerism” — the idea that all is lost and nothing can be done — is becoming more common as well.

With this in mind, Caitlin interviewed Dr. Thomas Doherty, an Oregon psychologist who specializes in climate-related therapy, with the goal of helping us to reframe how we think about climate change and to embrace a more resilient attitude toward the future.

More about managing money on NerdWallet:

The Average Home Insurance Cost in the U.S.

How to Save Money on Groceries: 14 Tips to Try

Calibrate Your Emergency Fund to a Crisis-Prone World

Have a money question? Text or call us at 901-730-6373. Or you can email us at [email protected]. To hear previous episodes, go to the podcast homepage.

Episode transcript

Sean Pyles: How do you think climate change is affecting you? Is it mostly media coverage of massive natural disasters? Is it weird fluctuations in status quo temperatures where you live? And what about your financial bottom line? Is climate change having an impact there?

Spencer Tierney: The main idea here is that humanity has already lost the fight against climate change and that all humans will just be extinct soon. These types of thoughts feed into a downward spiral of helplessness where you might truly believe just nothing can be done. So why do ordinary things, like save for retirement or pay our bills, if our tomorrows are running out?

Sean Pyles: Welcome to the NerdWallet Smart Money podcast. I'm Sean Pyles.

Caitlin Constantine: And I'm Caitlin Constantine.

Sean Pyles: This episode kicks off our nerdy deep dive into the broad effects of climate change on our financial lives. We'll explore how it affects daily money decisions along with larger decisions like when and where to buy a home.

Caitlin Constantine: Plus how we can use our banks and investments to make a difference, and also how to prepare financially should you find yourself dealing with a natural disaster.

Sean Pyles: OK, Caitlin, can you tell us why we are doing this exactly?

Caitlin Constantine: Sure. I actually really became interested in the intersection of climate change and personal finance through my work as NerdWallet's home insurance editor. So a big part of my job involves staying informed about what's going on around the country as it relates to home insurance. And I started seeing this pattern where states that were seeing a lot of damage from severe weather and wildfires were also seeing problems with their home insurance markets. And then the other thing that I was seeing is that people are aggressively indifferent to learning about home insurance.

Sean Pyles: Yeah, not the sexiest topic.

Caitlin Constantine: No, it is not the sexiest topic, and I think that those of us who work in this field know if you look on the internet, every other article on the internet about home insurance starts off with, "Well, we know that home insurance is boring." And you know what? No judgment from me, I also found it boring before I started working at NerdWallet.

It was the confluence of these two things that got me really interested in the way that climate change is directly impacting our bank accounts. It's not just an abstraction that will happen at some distant point in the future or just headlines about things that are happening halfway around the world, but it's something that's actually impacting us right now. And this podcast came about because I wanted to explore that a little bit more and see what useful information we could provide for our listeners.

Sean Pyles: Well, when you first pitched this idea to me, I was really excited to explore it because climate change and natural disasters are something that's been top of mind for me a lot over the past few years. In Portland, it seems like every nine months or so we have some completely disruptive weather event. In the summer of 2021, we had a heat dome that lingered over the area for days and temperatures hit nearly 120 degrees. A little bit before that, we had the Labor Day fires that scorched big swaths of the state. And more recently, earlier this year, we had a big snowstorm that came out of nowhere and left many people trapped in their cars on the highway for hours. It really was just a freak storm that no one was expecting. And people had to walk for miles to get home that day. They had to abandon their cars on the highway, and they couldn't get them for days. It was nuts.

Caitlin Constantine: That's terrifying. And you're having hail there right now, right?

Sean Pyles: As we're recording, it's hailing and then it's going to be sunny in about five minutes and then it's going to start hailing again because we've been having very strange weather here. But even between conversations with friends, I hear a lot of defeatism around climate change and what it means for their futures and their finances.

Caitlin Constantine: And we're going to talk a little bit more about that actually later this episode. But for those of you who might think, "Hey, that this is only a problem if you live somewhere that's prone to natural disaster." Like you're saying, "I don't live in tornado alley. I don't live near wildfire or hurricane risk. I don't really have to think about this," but you're wrong on two fronts. First of all, all of those risky areas are expanding. Ask anybody who was in New York City about the flooded subway stations in Lower Manhattan from Hurricane Sandy. Or you can talk to the people who live in Fort Lauderdale who just saw a 1 in 1,000 year rainfall that turned their airport tarmac into a small lake. That literally happened last month.

Or people in Southern California, they were dealing with flooding and a blizzard earlier this year. The rules have changed when it comes to what's going on with weather. Just because you have not experienced severe weather in the past does not mean that it is not going to change in the future.

And then second, you are paying the price for climate change, even if it doesn't seem like it. You're paying for FEMA, you're paying for rebuilding disaster zones, you're paying more for food and water because of heat and drought, you're paying more for energy because temperatures are getting more extreme. So the list really goes on and on.

Sean Pyles: And of course, there are lots of people who have been through disasters and know firsthand that more of them means more money that'll have to be spent.

Caitlin Constantine: And the people who study these things, they say that our economic standing both as individuals and as a planet on the whole, they may very well be affected if global net-zero emission targets aren't met. The Swiss Re Institute released a report two years ago that said that the world economy could be 10% smaller by midcentury and that global GDP could be 10 to 14% less than what it would be in a world without climate change. We're going to talk in a minute about how that translates at the personal level, but suffice it to say there's all kinds of knock-on effects when the global economy takes a hit like this.

Sean Pyles: All right. Listeners, we want to hear what you think around climate change and money, to share your ideas, concerns, maybe hopefully some solutions around climate change and finance with us. Leave us a voicemail or text us on the Nerd hotline at 901-730-6373. That's 901-730-NERD, or email us a voice memo to [email protected]. So, Caitlin, where are we starting off today in this episode?

Caitlin Constantine: We are going to start today by asking how big this problem is and why it's important. We're going to look exactly at how climate change is affecting our bottom lines, and then we're going to talk about how we can manage some of the really uncomfortable emotions around this and make our finances and our minds a little bit more resilient to climate risk. Our first guest is my fellow Nerd Spencer Tierney. He covers consumer banking here at NerdWallet, but he's also been reporting on how climate change is changing our finances.

Spencer, welcome back to Smart Money.

Spencer Tierney: Thanks, Caitlin. Glad to be here.

Caitlin Constantine: All right, let's start with a bit of an overview of the effects climate change is having on our personal finances. I'm guessing that when people think about that question, they probably think about folks who have gone through natural disasters like floods or wildfire, and we'll talk specifically about that later in the series. But can you give us a 30,000-foot view of how it could or how it is, ultimately, impacting all of our finances?

Spencer Tierney: Sure thing. Fair warning, some of this might sound depressing, but the ending message won't be. So think about how our taxpayer dollars go to natural disaster cleanup and prevention, that's likely to increase with more frequent and more severe weather events over time. We're talking rising coastlines will mean rebuilding more roads, more wildfires mean more resources there, and more severe hurricanes and tornadoes would mean more cleanup of debris. That's just on maintaining our physical landscape side that might be costly.

Caitlin Constantine: You know when you said that, you made me think about when I traveled to western North Carolina last summer, they had just seen a tropical storm. Tropical Storm Fred went through there in 2021, and you could see the debris still from that storm. They had significant flooding, and it left big trees and even trailers that were just washed up and a year later that debris still hadn't been cleaned out. It's a pretty big burden that is on those communities to get cleaned up after a storm like this.

Spencer Tierney: It's wild, and it's not going to get too much better. And then on the financial side of things, the Federal Reserve has even acknowledged that climate change may create some more financial instability. A 2021 report talked about the effect of climate on both economic and financial results. An economic impact would be loss of production, and then financial ones would be changes to the value of assets and even the availability of credit. And so weather-related disasters could even lead to more bank losses or closures, creating a chain reaction where there's reduced lending and investment in communities that need it. And all these results could happen from a variety of different factors, weather-related property destruction, failing public infrastructure, declining public health, rising mortality rates. Did I mention this was depressing? Drops in how productive workers are, and then even lower crop yields because of changes in water and heat. And the White House has estimated last year that damages from climate change-related events now cost the U.S. about $120 billion a year.

Caitlin Constantine: Wow. That's a lot of money.

Spencer Tierney: And remember, the U.S. is a high-income country. A lot of climate change will hit hardest on the lower end of the income spectrum. The United Nations says people in low-income countries are at least four times more likely to be displaced by extreme weather compared to people in high income countries.

Caitlin Constantine: You're right. That is pretty depressing. Let's go ahead and bring this down to the personal side where we all live. What are some of the issues that we're looking at here when we think about climate change and how it's going to impact our bank accounts and our wallets?

Spencer Tierney: That's a great question and brings a little bit more tangibility to things. A 2021 report by the European Central Bank concluded that hotter summers would play a role in less food supply, and then that means higher prices for food, and then hotter summers can also mean higher air conditioning costs. And then colder winters would mean higher home heating prices. Third, the declining value of investments. The Fed report we mentioned earlier, it describes the risk of climate change impacting the value of assets. One asset can be coastal real estate. For example, Florida homes, exposed to flooding, could lose 15% to 35% of their value by 2050, according to a 2020 report by the global consulting firm McKinsey.

Caitlin Constantine: Wow. That is a bigger number than I would have expected. And that report came out in 2020, so I wonder what that number would look like with all the people who have moved down to Florida over the past couple of years.

Spencer Tierney: Exactly. And that's a great point. And then another thing, health costs. These might go up not just from injuries or fatalities during extreme events, but even from air pollution and other ongoing conditions. But really, Caitlin, I think another big issue is that the effect of climate change and the fears about it can really impact people's behavior around money.

Caitlin Constantine: Let's go ahead and talk about that a little bit more. There's been a lot recently written about what's been called eco-anxiety or eco-grief, and it's really about how we respond emotionally to crises like these that can seem insurmountable. What are some of the financial knock-on effects here?

Spencer Tierney: That's a great question. There's a spectrum, goes from that mild concern or anxiety to the other extreme, which is being labeled climate doomerism. The main idea here is that humanity has already lost the fight against climate change and that all humans will just be extinct soon. These types of thoughts feed into a downward spiral of helplessness where you might truly believe just nothing can be done. Why do ordinary things, like save for retirement or pay our bills, if our tomorrows are running out? This mindset can actually be dangerous as scientists have pointed out since it can lead to the same exact effect that climate denial has, doing nothing to save the planet. And I'll say, not to defend the doomers, but I do get it. Hearing media headlines about climate change and how we're headed to the 1.5 degrees Celsius rise in global temperature by even the 2030s, that news is depressing.

Caitlin Constantine: Very depressing.

Spencer Tierney: But what climate scientists and the U.N.'s Climate Change panel actually say as of March 2023 is that reaching 1.5 or 2 degrees Celsius above preindustrial levels isn't an all or nothing doomsday clock. It's more a benchmark for when we'll have to adapt to more unpredictable disasters and more extreme temperatures. And these effects will be harder to stop, but not impossible. It's not good news, but official reports aren't actually saying we will go extinct.

Caitlin Constantine: I'm curious, Spencer, where do you fall on this spectrum? We both make our living writing and talking about finances, and this is something that you've thought and you've written about. What's your take on how climate change might impact how you conduct your own personal finances?

Spencer Tierney: That's a great question. I try to be an optimistic realist; I prepare for some worst-case scenarios while just trying to live my life. I have renter's insurance. I have a fireproof box I share with my partner to keep important documents safe. And I've been slowly switching to a bank that's not as bad about financing the fossil fuel industry. But I'm not perfect. I don't have flood insurance, and I bet some of my retirement savings aren't in the most eco-friendly investments, but I do what I can. What about you, Caitlin?

Caitlin Constantine: Probably the main thing I've done was move away from the Gulf Coast of Florida, which is where I lived for more than 20 years.

Spencer Tierney: Wow.

Caitlin Constantine: I'll tell you that that decision didn't actually start out as a financial one, but it was instead due to the fact that I really just couldn't tolerate the heat there anymore. I know that sounds silly, Florida is hot, but I went from being a triathlete who loved being active outside in the summer to being somebody who didn't really want to leave air-conditioned spaces most of the year. So it was a real significant impact for me. And then the fact that when I moved away from Florida, my home insurance premium dropped from $5,000 a year to about $1,000 a year. That ended up being a pretty significant financial decision for me.

Spencer Tierney: That's insane how much you saved on home insurance when you moved.

Caitlin Constantine: Yes, and I will tell you that that increase in my home insurance — and we're going to talk about home insurance in a future episode, we'll go into more depth on this — but it went up pretty fast over the past couple of years. And it wasn't actually until I started working this job as the home insurance editor for NerdWallet that I came to understand how wildly out of whack that is with most of the rest of the country. I moved to North Carolina and now I pay about $1,000 a year for my home insurance. It was a big change for me.

Spencer Tierney: That totally makes sense. And having a little more context definitely would change your opinion on that.

Caitlin Constantine: Yes, definitely. I think it's easy for people when you live in a state to just think that that's what the normal prices are. But with this job, I get to see what people all over the country pay, and you see $5,000, $4,000 a year is really, really high compared to what people in other parts of the country are paying.

Spencer Tierney: Totally. And I think that kind of thing can get lost in this discussion where a storm isn't just the damage to outside your home but also the things inside it.

Caitlin Constantine: Well, in a moment, we're going to talk with an expert who actually studies how climate change is affecting our emotions and well-being and how we can better manage those in a time of climate uncertainty. But, Spencer, what advice do you have for our listeners if they're wondering about the impact of all of this on their finances?

Spencer Tierney: You know, Caitlin, some of this advice comes down to what we'd say for any crisis: Build up your emergency fund, that's saving three to six months' worth of living expenses if you can, and stash important financial documents in a safe place. And then a few more, storm-proof your property. Depending on where you live, have storm shutters in case of hurricanes, install fire-resistant vents in case of wildfires, have sandbags in case of floods.

Caitlin Constantine: All good tips.

Spencer Tierney: And then a smaller thing at first, but it can pay off, reduce your food waste, which could mean eating more leftovers or getting more strategic at the grocery store.

Caitlin Constantine: I have to say that one is a tough one for me, even though I know how important it is. I have thrown out so many bags of what I call “aspirational spinach” that ended up like these bags of green mold. And I know that it's bad for the environment and I know it's wasteful, and yet it continues to be a struggle for me.

Spencer Tierney: The spinach is very relatable, and I think that's also an important point to bring up that cravings are OK and we're not reaching a perfection or purity mark with all this change that we might have to make in our lives. Just doing what we can over time, I think, is more important.

Caitlin Constantine: Progress over perfection, right?

Spencer Tierney: Exactly. Another thing, invest in more energy-efficient cars or home upgrades, such as solar panels and smart thermostats. The recent Inflation Reduction Act has created tax credits and rebates so you can save money as you become more energy efficient. Get multiple quotes for your home insurance policy to see if there are cheaper options, especially if it's been at least a year since you last picked a policy. This tactic tends to be your best bet for lowering your home insurance rates. And ensure you have enough coverage to weather different types of storms.

Caitlin Constantine: Great. Thank you so much, Spencer. I really appreciate you joining us, and we'll be talking with you again in a later episode.

Spencer Tierney: Sounds good. Thanks for having me, Caitlin.

Sean Pyles: You guys really weren't joking when you said that this was all going to get a little bit depressing, but what I appreciate is how you and Spencer discussed some practical, fairly easy ways that people can become more climate resilient and save some money, too.

Caitlin Constantine: None of this is easy, Sean. I mean, it's not easy to hear, it's not easy to report on. And frankly, that's what makes it really tempting to just tune this out, to just become fatalistic about it because we might be feeling how much difference can you actually make to solve a slow-moving global catastrophe.

Sean Pyles: And I totally feel that. I also know too many people who are sucked into the doomerism and have gone full YOLO mode, abandoning saving for retirement and just spending their money however they want. And I have to admit, it makes me worry about their financial futures. Although on my end, I try to do what I can to help reduce my personal carbon footprint. Small things like buying more vintage clothes and avoiding fast fashion, avoiding single-use plastic. And I'm also maybe a little obsessive about turning off the lights if they're not really being used in my house.

And at the same time, I also try not to think in too gloomy of terms about the future and what this is all going to do to my bottom line. When it comes to saving for retirement, for example. I'm pretty committed to maxing up my accounts if I can because I know that right now it's the best thing to do to set me up for financial success in the future. Sure, circumstances will always change, but doing the right thing right now and trying to be adaptable helps me sleep at night. But all of that said, sometimes it is hard to wrap my head around the gravity of climate change and stay sane at the same time.

Caitlin Constantine: I completely hear you on that. And I'm with you. And I'm going to guess that a lot of our listeners are with you as well. There's such a huge mental and emotional aspect to all of this, so that's why I decided to explore that with Dr. Thomas Doherty. He's a psychologist in Oregon who's developed something of a specialty in climate-related therapy. He's got a website called Sustainable Self and a podcast called "Climate Change and Happiness."

Dr. Doherty, thank you so much for joining us today and for talking with us.

Dr. Thomas Doherty: Thanks, Caitlin. I'm glad to be here.

Caitlin Constantine: First, let's go ahead and start with a basic question. Over the last several minutes of this podcast, we've heard from my colleague, Spencer Tierney, as he outlined some of the ways in which climate change is already impacting our lives and our bank accounts and how it's likely to continue to do so in the future. And honestly, it's hard to avoid feeling some anxiety about all of this. And I know that this has a name, which is eco-anxiety. Can you tell us a little bit about that, what it is and how it's become part of the mental health conversation?

Dr. Thomas Doherty: It's a deep question. Eco-anxiety as a term was first used in the early aughts, around 2007, and it came out of the media. It wasn't a scientific or a medical term, and it was describing people's concerns or fears. Originally, it was used around chemicals in the environment, actually, is the first use that I've seen, and people concerned about endocrine-disrupting chemicals and toxins and fish and things like that. And that gives us a little sense of eco-anxiety because it's really about ecology, it's about ecological systems, about concerns about threats to our health or our well-being from the larger systems that we live in, some of which are insidious. More recently, eco-anxiety has been used in relation to people's concerns about climate change and all the different things that could happen. And in my research, and I think even in the financial lens that you're looking, it's helpful to think about what are the impacts of climate change on our mental health?

And there's basically, if you want to simplify it, there's three kinds of impacts. There's disaster impacts that we all can understand from storms or flooding or sea level rise or severe droughts, heat events. And they clearly have impacts on our physical health, our mental health. And then there's the broad ripple effects through society: climate refugees, impacts on the supply chain, impacts on economy, farmers losing their crops, and that's broadly economic, and that can even affect civil wars and events around the world. And then there's the third category is the emotional impacts. That's just the angst of watching all this from a distance and it threatens our values, we worry about our future. Those are three kinds of impacts that your listeners have probably experienced.

Caitlin Constantine: And how do you think that personal finance specifically fits into this equation? Can you talk a little bit about where our bank accounts intersect with our concerns over climate change and its impacts?

Dr. Thomas Doherty: I love this conversation because it's such a great practical application of this. What I usually do when I'm working with people is stop at this moment and add a step before we talk about the actions, which is what I call our environmental identity, our sense of ourselves in relation to nature and the natural world, our values regarding nature, because that will help guide us with these questions about our purchasing and our lifestyle decisions. I think for your listeners, it's a good investment of your time to think about your environmental beliefs and values and your identity. I can talk about that for a moment. Then I think it sets the stage for these decisions. Does that make sense?

Caitlin Constantine: Yeah, it does. It helps you focus how you're thinking about things as opposed to just emotional chaos that we might be experiencing that's causing us to feel in these anxious ways.

Dr. Thomas Doherty: Exactly. When I've worked with financial planners in my own life, the first thing they ask me is, "What do I want out of life? And who am I? What are my values?" And we can start to see, we all have a story and then we have certain values. Some people's environmental values are — there's basically three categories of environmental values. There's egocentric values, like things for myself, values about myself, my family, my people. There's altruistic values, my concerns about others. And then there's ecological values, my concerns about the larger web of life and other species. When we're starting to think about, say, our investing or our financial decisions, it can start with our values. Is this about myself? Is this about social good, social justice, socially responsible investing say, or is it about even landscape conservation and more ecological concerns?

Once you give people the language for this, it really animates them, and then they start to realize, "That's why I might be drawn to different things in the world." Some people go toward technology, some people go toward changing the economic system, some people go towards spirituality, they go toward living small and simply. That's why I love this dialogue because once you open that up, it gives people some tools to make their decisions.

Caitlin Constantine: And as you said earlier, it really does remind me a lot of conversations that you have with a financial advisor because it is a lot about what do you value in life, what do you see as your goals going forward? But I hadn't thought about it in that framework of environmental identity before. I really appreciate you sharing that information with us.

We've been talking a little bit about eco-anxiety, and that captures it for some people. But there I've been reading a little bit more about what's been called climate doomerism. And that's the idea of people who basically say, "Look, it's too late to fix us. It's only going to get worse. It's not getting better, therefore, I'm just going to give up and I'm going to live as though the apocalypse is upon us." In financial terms, some people are saying, "Well, why should I save for retirement when the planet won't even be around?" How prevalent do you think this thinking is?

Dr. Thomas Doherty: One way to think about doomerism is that it's true. There are a lot of problems and it does seem intractable, and that's reality. Doomerism is a stage to move through. It's a place to be. That's how I think about it when I talk to people because climate change is a huge global issue. And when you really confront the reality of it, which people are doing more, it does seem hopeless. But that is only part of the process. because once you stay with the process, like with any new venture, once you stay with it and you start to learn some things and you start to engage with other people that are taking action and you realize, "Well, life is actually long and I do have to make some decisions," then we can start to move to, "What actions are we going to take?"

There's tons of people doing good things all over the world, and we don't know what's going to happen, and it doesn't really matter. If we have values, we have to act on them. We have to act in the face of our uncertainty. I would caution people not to argue so much about whether doomerism is right or wrong but see it as one facet of people's beliefs. But it's not the only belief system, and as we grow and evolve, we tend to go through stages.

Caitlin Constantine: Do you have, obviously you don't need to share names, but any concrete examples of a person who came to see you, just to help us better envision what this might actually look like for somebody?

Dr. Thomas Doherty: Sure. I'm thinking actually of couples that I've worked with because that's an interesting area. And obviously in terms of financial decisions, it often takes place in context of a couple or a family. I can think of concerns where one of the partners is, say, concerned about environmental anxiety and either concerned about storms and actual physical threats to where the person lives and starts to develop anxiety reactions. But partner A might be more interested in small-scale recycling and lifestyle things, whereas partner B might be interested in how we invest our money or whether we want to get solar panels for our house. One person may be more tech-minded or engineering-minded together, and one might be more emotionally oriented toward protecting animals and things like that.

And getting people to talk about their values and identities and concerns and value each other is then allows them to work toward compromises and shared values, like, "OK, I might be in charge of the house lifestyle things, and you can do research on sustainable investing or whether we want to get renewable energy or solar panels for our house." Freeing people up to go toward their strengths.

Caitlin Constantine: The fact that you talk about actions actually segues nicely into what I want us to talk about, which is getting practical for our listeners. We might have some of our listeners who are listening to this episode going, "Geez, I wasn't a doomer, but maybe I should be." I was reading a Pew report from September ’21 that surveyed people from 17 countries, and 72% of them said that they were sure that they'll be harmed by climate change at some point and that they're willing to do something about it but that only 46% of those people were confident that all of us will do enough globally to fix us. Can we talk about some concrete ways for us to build and cultivate emotional resilience instead of giving in to despair? What do you tell your clients?

Dr. Thomas Doherty: In terms of practical solutions, when I'm talking with someone or working with someone, I would start with their own preferences and their own — what I would introduce is the concept of what scale do you want to work on? Do you want to work on things that are really private scale? That could be how you set up your house, the products that you put in your house, whether you have a garden, whether you try to grow your own food, where you purchase your food. That's one level of action. There's also, in terms of your career or work, that might be a place where people can make a difference depending on where they're placed. And another level is broadly political, or activism, being a part of political groups or social groups, lobbying for legislation, being a part of the Citizens' Climate Lobby or dealing with our elected representatives. That's a level.

And also activism, really putting yourself out there to be the change and to take direct action against unjust systems. There's different levels of scale.

A practical thing that comes up a lot with people is travel and impacts of travel. Say if they live on the West Coast, they have family on the East Coast, like myself, or they're trying to do a dream vacation, and how do you square that with all the carbon offsets of travel and flights and things like that. That's a practical concern. It's important to take action, the most effective action we can, given all the knowledge we have, even if it's flawed, I think that's better than doing nothing because nothing doesn't feel good and we don't learn or grow from it.

Caitlin Constantine: As I said in a conversation earlier with Spencer, my colleague, progress not perfection is what we want to aim for with this. And I think that your point about the importance of action on mental health is really key because it can be very easy to get paralyzed when you feel afraid and when you feel anxious. And taking that first step, it can start momentum for you that can turn into bigger and bigger steps. Would you say that would be an accurate way to describe this?

Dr. Thomas Doherty: Yeah, exactly. And again, so much of this is about getting away from black-and-white thinking. Action is a good thing in life in general around any area of our lives, taking action, being proactive. But that doesn't mean we'll always succeed. It doesn't mean it's automatically a ticket to happiness, these things. But if we're going to adopt a growth mindset saying that we can grow and change both individually and even culturally, that's the direction that we need to go.

Caitlin Constantine: This has been really interesting. Thank you so much for all of this.

Dr. Thomas Doherty: I've enjoyed the conversation.

Caitlin Constantine: Sean, how are you feeling about all of this at this point? It's a lot to absorb, and it's not easy to hear that there's so much to worry about.

Sean Pyles: Honestly, I am feeling a little bit better after hearing your conversation with Dr. Doherty, not only because his voice is super soothing and perfect for a podcast.

Caitlin Constantine: Yes. Perfect therapist's voice.

Sean Pyles: Absolutely. I want to sit on the sofa and try not to fall asleep as I tell him all of my secrets. But the idea that he mentioned of understanding your environmental identity and using that to guide your actions around climate change and money is something that I'm really going to be mulling over for a long time to come.

Caitlin Constantine: Same. That really resonated with me as well. And it's been something that I've been thinking about since I spoke with him. And I feel like we also got some other great tips from Dr. Doherty. And, Sean, he has a practice that's not far from you in Portland; you can always go straight to him on this one.

Sean Pyles: I might just do that next time the local climate crisis becomes a personal mental health crisis. Caitlin, will you tell us what's coming up in episode two of the series?

Caitlin Constantine: Sure. Housing is a huge concern for a lot of people when it comes to climate change. If you live on a coastline, you might be dealing with rising seas. If you live near a river, you might deal with flooding. And if you live anywhere with drought, there's always the possibility of wildfire. We're going to look at how to make decisions about where to live and how to evaluate the risk involved in those decisions and then what you can do to mitigate some of that risk.

Holden Lewis: The standard homeowners policies don't cover floods, and that means that they don't cover rising water. They do cover falling water. If your roof blows off and rain falls inside, they'll cover that. But that's just one type of under insurance that people have.

Caitlin Constantine: For now, that's all we have for this episode. Do you have a money question of your own? Turn to the Nerds and call or text us your questions at 901-730-6373. That's 901-730-NERD. You can also email us at [email protected].

Also visit nerdwallet.com/podcast for more info on this episode. And remember to follow, rate and review us wherever you're getting this podcast.

Sean Pyles: This episode was produced by Tess Vigeland and Caitlin Constantine. I helped with editing; Sara Clarke helped with fact-checking; Kaely Monahan mixed our audio. And a big thank-you to the folks on the NerdWallet copy desk for all their help.

Caitlin Constantine: And here's our brief disclaimer. We are not financial or investment advisors. This nerdy info is provided for general educational and entertainment purposes, and it may not apply to your specific circumstances.

Sean Pyles: And with that said, until next time, turn to the Nerds.