America is threatened with default: how it will affect your life - ForumDaily
The article has been automatically translated into English by Google Translate from Russian and has not been edited.
Переклад цього матеріалу українською мовою з російської було автоматично здійснено сервісом Google Translate, без подальшого редагування тексту.
Bu məqalə Google Translate servisi vasitəsi ilə avtomatik olaraq rus dilindən azərbaycan dilinə tərcümə olunmuşdur. Bundan sonra mətn redaktə edilməmişdir.

America is threatened with default: how it will affect your life

The US is days away from being unable to pay its bills. Ever since the U.S. hit the national debt limit (that is, the total amount of federal debt that could be outstanding) in January, the Treasury Department has been using what it calls "emergency measures" to avoid a default. How could the life of Americans change if an agreement on raising the debt limit is not reached and the country defaults, the publication explained Lifehacker.

Photo: IStock

Earlier this month, Treasury Secretary Janet Yellen said in a letter to Congress that the US may not be able to pay its bills by June 1st. A little later, this date was moved to June 5.

So while Congress negotiates to raise the debt limit, the default date is getting closer and closer too.

The US has never defaulted on its debt before, and economists are warning of dire consequences if Congress fails to reach an agreement.

On the subject: What credit card can be opened in the USA by immigrants who do not have a banking history

How going over your debt limit will affect you

Yellen said a US debt default could cause "irreparable damage" to the US economy. Because the US has never defaulted on its debt before, there is no historical precedent for exactly what will happen. What is clear is that even approaching the US debt ceiling could have some potential consequences.

Social Security, Medicare and other government benefits

One of the first areas to be affected could be government programs. In this case, the Department of Finance may decide to delay or temporarily stop payments such as Social Security checks, Medicare payments, and even payments to state and local governments. If you are a government employee, you may not receive your salary on time.

Higher interest rates

If you're planning to apply for a credit card, mortgage, or car loan anytime soon, be prepared. Another consequence of the uncertainty and risk associated with exceeding your debt limit is rising interest rates. It affects everything from mortgages to student loans to credit cards.

Beyond your personal finances, higher interest rates are taking taxpayer money away from other much-needed federal investments such as infrastructure and education.

The recession and all its consequences

A default can trigger a recession. In particular, economists at Goldman Sachs have calculated that breaching the debt limit would immediately bring about one-tenth of US economic activity to a halt. This means a sharp drop in stock prices, a surge in consumer prices and job losses.

You may be interested in: top New York news, stories of our immigrants and helpful tips about life in the Big Apple - read it all on ForumDaily New York

Even aside from default, there is huge uncertainty about how the debt limit fiasco will hurt you as a person. For now, all you can do is focus on what you can and cannot control.

During a recession, your means of increasing income will be limited, so it's wise to focus on cutting costs. Keep building your emergency fund and be prepared for ripple effects such as job losses, higher inflation and higher borrowing costs.

Read also on ForumDaily:

Artificial intelligence has invented a new antibiotic: it will solve the problem that doctors could not cope with for decades

Hidden gems: seven high-end products you can buy at Aldi for pennies

Costco vs Aldi: Price Comparison of Five Popular Products

How much bad habits cost us: alcohol and fast food hurt the budget

Who to study in college to make good money: popular specialties lead to low wages

Miscellanea Congress The national debt Educational program debt limit
Subscribe to ForumDaily on Google News

Do you want more important and interesting news about life in the USA and immigration to America? — support us donate! Also subscribe to our page Facebook. Select the “Priority in display” option and read us first. Also, don't forget to subscribe to our РєР ° РЅР ° Р »РІ Telegram  and Instagram- there is a lot of interesting things there. And join thousands of readers ForumDaily New York — there you will find a lot of interesting and positive information about life in the metropolis. 



 
1079 requests in 1,228 seconds.