I’ve saved up some money to buy a home in 3-4 years. My financial advisor told me to invest it in US Treasuries since he says they have no credit or default risk.
What do others think? Is it safe to assume US Treasuries will never default? Or should I diversify and add things like short-term municipal bonds?
Scout said:
If they ever default, money will probably be the least of anyone’s worries.
Exactly. The whole world economy is so tied to the dollar that a collapse would cause chaos globally. It’s not impossible, but something catastrophic would have to happen for the US to default.
Scout said:
If they ever default, money will probably be the least of anyone’s worries.
Realistically, we’re more likely to see a technical default, like a delay in payments because of debt ceiling fights. It wouldn’t be catastrophic, but it’d still be bad. You’d still get your money, though.
Jasper said: @Winslow
Debt ceiling arguments are like eating the cake and refusing to pay the baker.
Kinda, but not exactly. If the government overspends, one option is just to cut back on future spending instead of raising the limit. Think of it like deciding not to book a flight when you’re already close to maxing out your credit card.