It’s hard to go anywhere today and not hear about the Fiscal Cliff. What is it? And why is everyone scared that we are going over?

Back in 2010, President Obama extended the Bush Tax cuts by two years, which means that they are set to expire at the end of this year. On January 1, Washington is increasing taxes by $600 billion. Many of the small taxes that come out of everyone’s pacheck at the end of the month will increase. For example, the federal income tax will go from 4.2% and increase to 6.2%.

That’s not the only thing that is going over this cliff. Washington is also increasing the spending cuts.

With this country already $16 trillion in debt, some are asking whether Washington is going to let the country tumble off this cliff and head for another recession, or will they try to either extend the tax cuts again or figure out another solution.

But they don’t have that much time left; all of Washington will soon be going on break for the holidays, and when they return, it will already be past January 1.

Some finacial professionals believe that this country might actually need to head over this cliff. SV’s  Mr. Ray Peaco, one of the personal finance teachers, is on the proverbial fence on this topic. He says that the Bush tax cuts were a gift and a curse. “For the past couple of years, I’ve basically been getting a bonus in my paycheck,” says Peaco. “But shouldn’t  we have seen this coming?”

So, will Obama, the Senate and the House fix it, or let our economy tumble? On Nov. 29, Obama met with Mitt Romney for the first time since the last presidential debate and broke bread, possibly talking over “cliff” talk.

Many are not sure what they discussed, but rest assured, this problem is being addressed in one way or another.