Natural disasters hit the finances of 1 in 5 adults in the U.S. in 2023: Fed

Natural disasters affected the finances of 1 in 5 adults in the US in 2023: Fed Nearly 20% of adults in the United States were economically impacted by natural disasters during the past year, as revealed by the Federal Reserve's annual report published on Tuesday. This percentage represents a significant increase of almost 50% compared to the previous year, indicating the growing vulnerability of the population to natural catastrophes such as floods and wildfires. In particular, the data showed a notable increase in the western part of the country, where the number of people reporting financial consequences due to natural disasters nearly doubled. Similarly, in the south, which includes hurricane-prone states such as Florida, approximately a quarter of respondents reported experiencing negative economic impacts, contrasting with 13% in the northeast. The Federal Reserve emphasized that those at higher risk of experiencing natural disasters were less likely to have home insurance, especially lower-income homeowners. This finding underscores the importance of having adequate financial protection measures in place for unforeseen events that could jeopardize household economic stability. Although 72% of American adults reported a stable financial situation in 2023, the report highlighted a decline in the economic perception of parents with children under 18, with only 64% rating their situation as at least good, five percentage points lower than in 2022. Responsibilities related to childcare, including costs associated with paid childcare, posed a significant burden on the family budget, reaching between 50% and 70% of monthly housing expenses for some parents. Regarding financial concerns, inflation continued to be the primary source of anxiety among Americans in 2023, despite a moderation compared to the previous year when it reached decades-high levels. More than a third of respondents identified inflation as an economic challenge, with the increase in food costs being one of the major concerns. These data reflect the complex interaction between natural disasters, financial security, and everyday economic pressures faced by American households. The importance of having preparedness and financial protection strategies for unforeseen events becomes increasingly evident in a context of growing climate and economic challenges. The Federal Reserve pointed out the need to address these issues comprehensively to strengthen the financial resilience of the population and mitigate the adverse impacts of future catastrophic events.