Federal agencies have been asked if they may postpone impending payments like the Social Security Check because the US debt limit negotiations are at a standstill and there is only one week left before the US could fall into default.
Although it is unknown whether those delays will affect Social Security payments, several senior supporters are still concerned that payments may be delayed if the debt ceiling isn’t raised soon.
Debt Ceiling Standoff Raises Social Security Payment Concerns
The Washington Post on Tuesday cited two persons familiar with the situation when it claimed that the US Treasury Department has asked federal agencies if they might postpone payments.
According to Treasury Secretary Janet Yellen, a default might occur as soon as June 1. The requests are intended to conserve cash and prevent that.
Treasury officials want to know how accommodating some agencies are about deferring payments scheduled before early June in order to prolong the ‘X date’ as much as possible,.
The other source said the Treasury Department has not asked federal agencies to postpone payments beyond their due dates.
One suggestion being put out is to sell bonds owned by the Highway Trust Fund or Social Security Trust Fund, which would quickly raise tens of billions of dollars for the purpose of funding specific government initiatives.
The trust funds would then be paid back after the debt ceiling standoff is resolved.
The possibility of Social Security payouts being postponed should government agencies delay upcoming payments was not specifically mentioned.
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Debt Ceiling Deadline Looms
Yet, if the government defaults, the sizable retirement scheme could be at risk.
The first installment of Social Security payments for June will be made on June 2 and will amount to around $25 billion.
On June 14, June 21, and June 28, there are three further payments of around the same amount that must be sent.
If politicians are unable to come to an agreement on the debt ceiling over the next week or so, those dates may be crucial.
If the cap isn’t expanded, the government might run out of money between June 2 and June 13 according to the Bipartisan Policy Center’s most recent projection.
This could theoretically result in a delay in Social Security payments that are due on or after certain dates.
How and whether government officials prioritize particular programs will have a significant impact. Yet for the millions of users who rely on the program to pay for living expenses, it’s still a concerning concept.
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