Although defaulting on the U.S. Government’s debts would have had drastic consequences on the entire economy, seniors would have faced the impact as much, or maybe even more, than many others. A government default would have endangered Social Security, Medicare, Medicaid, and Veterans’ benefits but would also have had devastating consequences on the stock market, which so many seniors rely on for a big part of their retirement income.
However, while the drama on that issue is over for now, it will be repeated in two years.
The Senior Citizens League
Let’s clarify, a default would have disrupted Social Security payments and delayed paying health care providers under Medicare, but once the issue was resolved, payment would be made retroactively.
For beneficiaries concerned about a delay in their Social Security payments, the next two years is a good time to built a cash reserve of two to three months net Social Security payment – just in case. 😢
QUINNSCOMMENTARY 
Congressman John Larson of Connecticut has introduced new legislation Social Security 2100 to strengthen Social Security and do away with the Windfall Elimination Provision and Government Pension Offset (WEP/GPO) that penalizes public servants. I truly hope that this bill will garner bipartisan support. Please ask your representatives to support this bill.
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It was introduced years ago and has mostly been ignored. You can find a summary on this blog.
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I do have cash reserves but for other things, not for a default. The “drama” of the countdown until Uncle is broke is not something I pay attention to. It is pure theater.
Everyone needs some cash reserves because if nothing else, you’ll sleep better.
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This is good advice. There are other reason why your Social Security checks can be delayed. If there is a government shutdown because Congress can’t get their act together and pass a budget, it may slowdown or delay the sending or transferring of Social Security checks, strictly from lack of employees working not from a lack of money in the Social Security fund because the fund is not affected. I believe in the past that the government has made Social Security a priority but past performance does not guarantee future performance and it is better to have that emergency fund ready if payment is delayed.
I would also put that emergency fund in another bank. I once had a bank seized by the regulators. Lucky for me, I had another bank account that I could use. It still took about 4 weeks to get all my direct deposits transferred and or returned to me from the failed attempts to make the direct deposits into the closed bank. I did get all my money from FDIC in 7 days.
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Your point is well taken, we should have a fund that prevents default or even a delay on SS and health benefits to those that paid into it. How about defaulting on congresses pay?
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If only.
Turns out, you CAN take it with you…
Americans Have So Much Debt They’re Taking It to The Grave
· New data shows that 73% of American consumers die in debt. The average total balance left over is $61,554 (and that includes mortgage debt).
money.com › Mar 22, 2017
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