Does the Government Shutdown Affect Social Security Payments?

social security

After the U.S. Senate failed to reach an agreement on a new spending bill, the U.S. federal government shut down at midnight on Friday, Jan. 19.

A government shutdown has far-reaching effects on federal operations, and it also has millions wondering how the shutdown will impact their day-to-day lives.

Chief among them are American retirees who need to know how the government shutdown will affect social security payments.

The answer largely depends on your current status with the nation's Social Security Administration as of last Friday at midnight.

Here's what we mean...

How Does This Government Shutdown Affect My Social Security?

If you were receiving federal retirement benefits prior to the government shutdown, then there is a high likelihood you won't be impacted at all.

The money that funds the nation's Social Security program comes from the Social Security Trust Fund, an independent trust that is managed by the Social Security Administration.

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This fund and the distribution of the money in it is deemed an "essential government service" during a federal shutdown and is therefore protected from any freeze in government spending.

This is similar to the way the U.S. Postal Service or air traffic controllers are treated during a shutdown. Because mail delivery and safe airways are essential to keeping the nation running smoothly, they are protected from the significant shuttering applied to other programs that are deemed "non-essential" like the National Park Service.

Because social security payments are necessary for the well-being of America's retirees, it is not affected by the government shutdown.

However, there is one group of retirees that will be subject to a suspension of their benefits until the shutdown is resolved...

These Retirees Are Impacted by the Government Shutdown

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Retirees who applied within the last six weeks to receive their benefits will likely not receive their social security checks during this shutdown.

This is because during a shutdown, the Social Security Administration furloughs many of the employees who are responsible for processing new SSI applications.

This was the case during the longest government shut down in American history. During the Clinton administration, the federal government shut down for 21 days. As a result, the Social Security Administration stopped processing new SSI benefit applications for a week and a half.

There is also a chance that other sources of retiree income will be temporarily interrupted if the shutdown is prolonged...

Individuals receiving veterans' benefits, unemployment insurance, farm subsidies, and tax refunds could experience delays due to the shutdown.

During the last government shutdown in 2013, veteran's benefits were briefly delayed as the Veterans Affairs Administration dealt with staffing issues.

While interruption to these additional benefits is rather unlikely, it is important to be aware of any potential impact the shutdown might have on federal sources of income.

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