How default might affect you

Life might get more difficult for many Americans if Congress doesn't reach a deal to raise the government's borrowing limit.

Without the ability to borrow more, the Treasury has said it would not have enough cash on hand to pay all its bills, which include payments due on the government's outstanding debt. Experts disagree on when exactly such a default would occur or how long it would last. But the impact could be wide-reaching.

"In almost every area where people have pocketbook concerns -- jobs, interest rates, credit, availability of government payments, benefits -- all those things would be affected in relatively short order," Ben Bernanke, chairman of the Federal Reserve, warned Congress earlier this month. Here's how:

GOVERNMENT CHECKS. Monthly budgets might take a hit. To avoid a default, the Treasury would have to conserve cash and prioritize its payments, endangering the estimated 80 million checks the government pays each month, including 56 million to Social Security beneficiaries and 8.3 million to disabled citizens. That means anyone counting on the government for unemployment assistance, food stamps or other benefits could feel the pinch.

FEDERAL WORKERS. Government employees and contractors might not get paid. The federal government processes an estimated 3.9 million payments each month for federal workers' salaries as well as 1.8 million to non-defense contractors who do government work, according to Treasury estimates. Those payments would be put at risk if the government were forced to juggle payments to meet debt obligations. And when people don't get paid on time, they wonder whether they should bother to report to work. That leaves open the possibility of service disruptions in the federal government.

JOBS. It might become harder to get a job. With less money coursing through the economy, consumers' economic activity could slow. Consumers might hold back on spending. That in turn would give businesses even less confidence to hire people during a time already marked by anemic 1.3 percent second-quarter growth. An outright default could send shock waves through the economy, buffeting the job rolls even more.

LOANS. It could become more expensive to get a loan. Interest rates could rise on mortgage loans, home equity lines of credit and car loans.

STOCKS. Retirement portfolios might take a hit. Stock markets had remained relatively calm because investors had priced in a very low probability of a default. But as the deadline approached with no deal, markets posted their worst weekly performance in more than a year and major indexes saw their longest monthly losing streaks since the 2008 financial crisis.

PROJECTS. Local improvement projects could get delayed or canceled. Moody's Investors Service has said it would review 177 municipal governments for possible downgrades if the federal government loses its pristine credit rating. That could make it more expensive for localities with close ties to the federal government, contractors and employees to borrow money to build roads, schools, hospitals and other important infrastructure projects. And the federal government itself would have less money to spend on infrastructure projects since experts estimate that loss of its top-notch credit rating would tack on billions in interest to the federal budget, crowding out priorities such as transportation, education and health care spending.