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2. Treasury Secretary Janet Yellen has warned that the U.S. The default could cause an "economic catastrophe" for senior citizens and disabled individuals dependent on Social Security funds.
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3. Investor reluctance to hold on to government debt due to the debt ceiling impasse has already increased the burden on US taxpayers and could slow the economy.
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4. US has never defaulted on its loans before, so the exact consequences are unclear, but could result in a government shutdown or default.
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5. In a shutdown scenario, parts of the Social Security Administration may shut down, but automatic checks will still be issued. In case of default, checks will be dishonored due to paucity of funds, but a quick resolution is expected.
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6. Social Security benefits are funded through payroll taxes and bonds redeemed from the Social Security Trust Fund.
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7. Default could potentially cause a delay or reduce the amount of a Social Security check, although the duration of the delay or the extent of the reduction is uncertain.
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