Concerns about extreme weather are driving anxiety related to Americans’ nest eggs, according to the 2024 Annual Retirement Study from Allianz Life Insurance Company of North America (Allianz Life).

More than half (56 percent) of Americans say they have anxiety about rising costs, financial losses, or even health effects from extreme weather events or natural disasters.

Millennials (70 percent) are more concerned about future finances than Gen Xers (53 percent) or boomers (32 percent).

More Hispanic respondents (66 percent) are anxious than Asian/Asian American (57 percent), Black/African American (50 percent) and white (55 percent) respondents.

“We see extreme weather almost daily in the news,” says Lorinda Niemeyer, head of sustainability, Allianz Life. “As natural disasters become more frequent, more intense and more costly, Americans are waking up to how this could pose a risk to their retirement nest egg. It’s not just the recovery costs after a disaster strikes. For many, extreme weather is increasing daily costs of living, insurance costs and other ongoing expenses. And those costs are tough to absorb if we don’t plan for them.”

Risks of rising costs, loss of insurance or damages due to extreme weather or natural disasters were ranked by one in four Americans (25 percent) as the top three risks to their retirement income, the study found.

This was the same or higher than concerns like taxes, debt or caregiving responsibilities.

The study found that 82 percent said creating a plan to mitigate or cover financial implication of external events such as extreme weather or natural disasters would help ensure that they could financially support all the things they want to do in life.

“Extreme weather has the potential to erode wealth just like other risks to a retirement strategy like inflation and increasing medical costs,” Niemeyer says.

The study found that Americans who have been financially impacted by extreme weather are more likely to have a written financial plan and strategy to protect themselves from risks in the future.

Nearly half of Americans (48 percent) who have not been financially impacted by extreme weather do not have a written financial plan. And just 14 percent of those who have experienced extreme weather said the same.

More than one in three (36 percent) of respondents financially impacted by extreme weather say they have included the potential implications of extreme weather or natural disasters into their financial retirement plan. Just 12 percent who have not experienced this said the same, Allianz said.

“Americans who have experienced extreme weather and its effect on their finances have learned a hard lesson and now want to make sure they are financially prepared for another natural disaster to strike and protect themselves against this risk in the future,” says Niemeyer. “This can serve as an important lesson for others, too.”

The 2024 Annual Retirement Study was conducted in February and March 2024 with a nationally representative sample of 1,000 individuals age 25+ in the contiguous U.S. with an annual household income of $50k+ (single) / $75k+ (married/partnered) OR investable assets of $150k+. The study included an oversample of respondents who identified as Black/African American (416 responses); Hispanic (398 responses); Asian/Asian American (366 responses).