The boom time in the United States appears to be coming to an end. Payments related to Social Security and Medicare could be in trouble in the near future. The unpaid debt makes everything hanging by a thread in a country that needs certain changes to be able to afford the payments.
Last January 19, the United States reached the legal limit of outstanding debt. This means that it can no longer borrow more money to meet legal obligations. These legal obligations include the Medicare and Social Security systems. We may also run into military workers’ salaries and tax refund stimulus cheques here.
What are the potential problems with Medicare and Social Security?
The main problems, as CNBC points out, is that the two programs will begin to run out of money. This will mean that it is possible that many citizens with a retirement benefit will stop collecting their monthly cheque. At the very least, it could also be that they will collect late or with a reduction in their cheque.
As far as Medicare is concerned, the situation is the same. Users of this service could find that Medicare does not cover the expenses that it normally covers. Therefore, it would be a really unpleasant situation for Americans.
Treasury Secretary Janet Yellen warned in a letter last 13th about the possible irreparable damage that the U.S. economy could receive. This she warned based on current data on the economy. “I respectfully urge Congress to act promptly to protect the full faith and credit of the United States,” Yellen herself said.
What can I do as a citizen to avoid these problems?
The most advisable thing for Social Security and Medicare users is to watch out for everything that is to come. If in the end the debts force cuts in the social help programs, we must be forewarned.
For that reason, it is a good idea to save as much money as we can. In addition to this, it is also good to find a source of extra income to help the family members financially.
On the other hand, it is also a good idea to maximize the Social Security cheque in case we have not started collecting the retirement benefit. The bigger the cheque, the better golden years we will have.