How Can a Government Shutdown Affect You?

Highlights:

• A government shutdown happens when Congress fails to pass legislation funding federal programs.
• When the government shuts down, federal agencies must suspend all non-essential services.
• A government shutdown can cause various problems for consumers.

A government shutdown can affect thousands of federal employees and millions of Americans. Many essential government employees are either furloughed or work without pay. American citizens using government benefits should be concerned if these will continue. Regardless of your situation, you may wonder how you will be able to pay your bills. And if you can't pay your bills, how will that affect your credit?

How does a government shutdown affect you?

When the government shuts down, federal agencies must suspend all non-essential services. When this happens, certain government programs may have delays or disruptions.

• Social Security. People receiving Social Security benefits should still continue to get their benefits. But the Social Security Administration may pause action for some requests. These include benefits verification and issuing replacement Medicare cards. New applicants for Social Security Disability Insurance (SSDI) may also experience delays.
• Supplemental Nutrition Assistance Program (SNAP). SNAP, or "food stamps", can have disruptions. This can also extend to the WIC and Head Start programs. There is a SNAP Contingency Fund which the government can use as a temporary measure to fund SNAP. If this runs out, millions of Americans risk not having available SNAP benefits.
• Medicaid and Medicare. Americans on Medicare and Medicaid should continue to receive their benefits. But some actions may have delays. These include getting replacement Medicare cards and benefit verifications. Responses to Freedom of Information Act requests will also have delays.
• Unemployment Benefits. A government shutdown will not affect unemployment benefits. But, the application process may have delays.
• Travel. TSA officers and air traffic controllers are essential employees. During a government shutdown, they will continue to work, but will not get paid. This may lead to employees not showing up to work, causing delays for many travelers.

Can a government shutdown affect your credit scores?

A government shutdown alone will not impact a consumer's credit scores. But, if you lose benefits and have to borrow more than you can pay back, you may have to deal with a late payment. Even one late payment may impact credit scores. If you find yourself in this situation, contact your lenders and creditors. Explain what is going on and see what they can offer. Some creditors can waive late fees or offer short-term loans. Some may offer reduced payments or interest only payments for a set amount of time. This is often referred to as forbearance. Accounts in forbearance can still count as late or missed payments. This is why you should try to make at least the minimum payment on accounts.

You can also add a Consumer Statement to your Equifax^® credit report to explain your situation. You can also contact Experian^® and TransUnion^® to add a statement on those credit reports.

Can a government shutdown lead to identity theft?

No, a government shutdown will not lead to identity theft. But, if you become a victim of identity theft during a government shutdown, it may be harder to report it. During a government shutdown, certain Federal Trade Commission (FTC) services are not available. You will not be able to report fraud through http://reportfraud.ftc.gov/. You will also not be able to report identity theft through http://identitytheft.gov/.

If you become a victim of identity theft during a government shutdown, there are still steps you can take. Report the identity theft to your lenders and creditors. You should also report the identity theft to Equifax, Experian, and TransUnion. Equifax, Experian, and TransUnion also offer fraud alerts and security freezes. A fraud alert lets lenders know that you may have been a victim of fraud. A security freeze prevents access to your Equifax credit report to open a new line of credit.

How Equifax can help during a government shutdown

If you have concerns about how a government shutdown can affect you, Equifax can help. We offer many ways for you to track your credit and help better protect your identity. Monitor your Equifax credit report and help better protect your identity with Equifax Complete™. You'll also stay in the know with daily access to your VantageScore credit score. The credit score provided is a VantageScore^® 3.0 credit score based on Equifax data. Third parties use many different types of credit scores and are likely to use a different type of credit score to assess your creditworthiness.

You can also track your credit and help protect your identity with the myEquifax™ app. With the myEquifax app, you have access to your free credit score and Equifax^® credit report — no credit card required. This credit score is a VantageScore based on Equifax data. Third parties use many different types of credit scores and are likely to use a different type of credit score to assess your creditworthiness. You can download the app if you use an Apple^® or Android^® device.

A government shutdown can lead to a lot of uncertainty. But with some planning, you can work to offset some of these impacts.