How massive winter storm Fern will affect your money

A major winter storm threatens to wreak havoc across the United States in the coming days, potentially causing an economic blow to households in its path.

The National Weather Service announced Friday that a “severe, prolonged winter storm” is expected to bring heavy snow, sleet and freezing rain to a wide swath of the United States, from the southern Rockies to New England, starting Friday and continuing into Monday.

More than a foot of snow could fall in some areas, and “localized catastrophic ice accumulation” and frigid temperatures could cause prolonged power outages, widespread tree damage and widespread traffic disruptions, the weather service said.

The National Weather Service announced early Friday that the storm could affect more than 170 million Americans.

Despite the economic losses from such storms, people can take steps to cushion the economic blow, financial experts said.

“The big cost of winter storms is the damage to your home and the aftermath of an accident,” says Carolyn McClanahan, a certified financial planner and founder of Life Planning Partners in Jacksonville, Florida. Mr. McClanahan is a member of CNBC’s Financial Advisory Council. “People should prepare ahead of time for this storm by covering water pipes, bringing in or covering plants, and stocking up on essentials so they don’t have to go out.”

Here’s what you need to know about the potential financial impact and how to prepare for it.

Winter storms can cause all kinds of damage to homes, from water damage from frozen pipes bursting to roofs destroyed by tree branches bent under the weight of ice.

Fortunately, people with homeowners insurance can usually recover the cost of damage caused by wind, snow, bitter cold or freezing rain, said Karen Collins, vice president of property and environmental affairs at the Property Casualty Insurance Association of America, an industry group.

According to the Insurance Information Institute, the average insured loss claimed for water damage and freeze from 2019 to 2023 was $15,400. The wind and hail average was about $14,700.

Consumers filed more than 20,000 claims for frozen water pipes and winter water damage from January 2024 to June 2025, totaling more than $628 million in paid damages, according to an analysis of closed and paid homeowners claims by insurance company State Farm. The average insurance claim amount exceeded $30,000.

However, policyholder coverage varies depending on the fine print.

For example, most homeowners insurance policies will cover “sudden and accidental” water damage from a burst pipe, as long as the home is properly heated and not left unattended, according to the Massachusetts Department of Insurance.

Experts recommend heating your home to at least 65 degrees Fahrenheit or higher to prevent pipes from freezing.

According to the Insurance Information Institute, “Temperatures within the wall where the pipes are located are significantly cooler than the wall itself.” “Temperatures lower than 65 degrees will not prevent the interior walls from freezing.”

However, it is not always possible to keep the house heated all the time.

The so-called “Texas Freeze” of 2021 was the costliest winter freeze in U.S. history, with the cold snap causing widespread power outages, leaving people unable to heat their homes and ultimately leading to large insured losses from water damage and burst pipes, Collins said.

According to the Property Casualty Insurance Association of America, homeowners can help by insulating internal and external pipes, opening sink faucets and letting water drip slowly to prevent freezing, and locating original water shut-off valves in case a pipe bursts and the water needs to be turned off.

Across the country, consumers are stocking up on groceries ahead of the extreme cold snap.

Experts say that while it may make sense to buy certain items when the weather worsens, stocking up is rarely a good idea.

In many cases, “it generally doesn’t make sense to stockpile extensively in advance of a winter storm,” said Amir Mousabian, a supply chain management professor at the University of New England’s School of Business.

“Families should plan to have enough food and essentials to get them through a few days in case travel is temporarily restricted, but there is little benefit to shopping much beyond that,” he said.

While buying in bulk may save money, “there is also a real risk that households will buy too much fresh food, leading to wastage and money loss,” Mousabian said.

In many cases, he said, this type of stockpiling can harm ordinary consumers.

If supply is limited and demand increases, prices will rise. Food prices are particularly volatile compared to many other consumer goods due to supply and demand factors.

“Sudden spikes in demand can put a strain on supply chains,” as was seen during the coronavirus pandemic, Mousabian said. “Modern supply chains, while highly efficient, are not designed to absorb sudden, artificial spikes in demand, and those spikes in demand can ultimately be to the detriment of consumers.”

Airlines have already canceled thousands of flights as the winter storm approaches.

Several major airlines, including Delta Air Lines and United Airlines, have already announced change fee waivers for travelers whose itineraries may be affected by the looming winter storm.

Experts say it may be wise for some travelers to take advantage of these benefits.

For example, if you’ve booked non-essential travel and can reschedule it a week from now, it might be a good idea to take the plunge and change your flight, said Nick Ewen, senior editorial director at The Points Guy.

If the airline cancels your flight and does not accept rebooking options, you may be eligible for a full refund, Ewen said.

However, if you cancel your flight yourself, you will not be entitled to any airline credit or voucher unless you have paid for the fully refundable flight. Ewen said they would also not receive a full refund if their original flight was cancelled.

“If you’ve already proactively changed, you’re now on that new flight, that new itinerary, that new date, and then you’re going to be affected by the policies that are in place for that new ticket,” he said.

Download your airline’s app and make sure notifications are turned on so you’ll be notified if there are any changes to your flight, he said.

For car rentals, Ewen said most companies allow you to change or cancel your reservation up until pick-up time. However, this may not be the case if you book through a third party, such as a travel website or credit card company, where you typically pay in advance.

Hotels typically allow free cancellations up to 24 or 48 hours prior to your stay, depending on the reservation. If you book on a non-refundable rate, you may not get a full refund, but Ewen says it’s worth calling the hotel and explaining your situation, especially if it’s weather-related.

“I can’t guarantee it, but if you call and explain the situation, they might be able to give you a little more leniency,” he said.

However, he said some credit cards offer travel interruption coverage. Even if the hotel doesn’t refund your money, you may be able to file a claim with your credit card company and get a refund as long as you paid with that card.

A separate travel insurance policy may also provide additional protection.

Many households can expect their heating costs to increase as temperatures drop and more electricity is needed to keep the home warm.

According to the U.S. Energy Information Administration, energy demand for space heating often increases, especially when cold weather hits large areas of the country. This increases demand for both electricity and natural gas.

The spot price of natural gas has risen sharply over the past week, reaching $8.15 per million British thermal units on January 22, up from $5.19 the previous week. According to the EIA, increases in the wholesale price of natural gas generally contribute to increases in the wholesale price of electricity.

Consumers are already feeling the pinch from rising electricity prices. Some of this is believed to be due to the development of data centers that enhance artificial intelligence and put extra demand on the power grid.

Electricity prices rose 6.7% in December compared to the same month last year, according to the latest reading of the Consumer Price Index.

Meanwhile, the cost per gallon for households using heating oil was $3.66 as of Jan. 19, down from $3.93 a year earlier, according to the EIA.

Courtney Fieldman, Utility Program Director for the Southwest Energy Efficiency Program, shares these tips for conserving energy and, in turn, money as the frigid weather continues:

Optimize your thermostat. When the sun is still warm during the day, setting your home’s temperature a little lower to 65 to 68 degrees Fahrenheit will not only keep you more comfortable, but it can also reduce your heating costs by 10%. Block drafts. Use towels, blankets, and even rolled-up clothes to seal off gaps under doors and windows, and shut off unused rooms by closing doors and vents to keep heat where you need it. Up to 30% of heat can be wasted due to air leaks in windows, doors, and attics. Utilizes natural heat and cuts unnecessary heat. Open the curtains on the sunny side of the house during the day, then close them afterwards to trap the heat. Avoid excess heat during peak times by wearing warm layers, turning off lights in unoccupied rooms, and using blankets instead of space heaters if possible.

Correction: This article has been updated to reflect that the National Weather Service says the storm will affect more than 170 million Americans.

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