What Is the National Debt?

The national debt is the total amount of money the federal government has borrowed and not yet repaid. When the government spends more than it collects in taxes each year (a deficit), it borrows to cover the gap by issuing Treasury securities — bills (maturity under 1 year), notes (2–10 years), bonds (20–30 years), TIPS (inflation-protected), and savings bonds. Each year’s deficit adds to the cumulative debt. The Treasury’s guide to the national debt explains the full mechanics.

The debt is fundamentally different from household debt. A family borrows against future income and must repay in full. The government borrows against the full faith and credit of the United States and can roll over maturing securities indefinitely — it never needs to pay down the principal to zero. The real question is not whether the debt can be repaid but whether the interest on it can be serviced sustainably. When interest costs consume an ever-larger share of revenue, less money remains for defense, infrastructure, education, and social programs.

The debt is tracked in real time by the Treasury’s Debt to the Penny dataset, which reports the total public debt outstanding at the close of each business day. This is the source powering the live counter at the top of this page. The data goes back to April 1993, and the Treasury also maintains a Historical Debt Outstanding dataset reaching back to 1790.

Debt Breakdown: Public vs Intragovernmental

The national debt consists of two components, both reported daily by the Debt to the Penny dataset. Understanding the distinction matters because only debt held by the public affects financial markets and borrowing costs.

Debt held by the public ($31.36 trillion, 80.4%): Money borrowed from domestic investors (mutual funds, pension funds, banks, insurance companies, individuals), foreign governments and investors, and the Federal Reserve. These are marketable Treasury securities actively traded in the bond market. This portion drives Treasury yields and, indirectly, the prime rate and all consumer interest rates.

Intragovernmental holdings ($7.63 trillion, 19.6%): Money the government owes to its own trust funds — primarily the Social Security Old-Age and Survivors Insurance Trust Fund (~$2.7T), Medicare Hospital Insurance Trust Fund, military retirement funds, and federal employee pension funds. When these programs collect more in payroll taxes than they pay out, the surplus is invested in special non-marketable Treasury securities.

National Debt by Year (2014–2025)

The debt has grown from $17.82 trillion at the end of fiscal year 2014 to $37.64 trillion by the end of FY 2025 — more than doubling in 11 years. The sharpest single-year increase was $4.23 trillion in FY 2020 (COVID pandemic response). For the complete record back to 1790, see our National Debt by Year page.

Interest Rates on Treasury Securities

The government pays different interest rates depending on the type and maturity of Treasury security. Short-term bills carry rates closely tied to the federal funds rate, while long-term bonds reflect market expectations for future inflation and growth. The weighted average across all outstanding debt is approximately 3.36% as of February 2026.

At a weighted average rate of 3.36% on ~$31 trillion in marketable debt, the government pays approximately $1.04 trillion in annual interest — roughly $2.74 billion per day or $114 million per hour. This makes interest the third-largest line item in the federal budget, behind only Social Security ($1.46T) and Medicare ($1.05T), and ahead of defense ($886B). For a deep dive into interest cost trends, see our Interest on the National Debt page.

Who Holds the US Debt?

Of the $31.36 trillion in debt held by the public, domestic holders own approximately 70% and foreign entities hold about 30%. The Federal Reserve is the single largest holder at approximately $4.9 trillion. For the full interactive breakdown, see Who Owns US Debt.

A common misconception is that China “owns” a dangerous share of U.S. debt. In reality, China holds approximately 2.4% of publicly held debt and has been steadily reducing its Treasury holdings since 2013. Japan is the larger foreign holder. The dominant holders are domestic: American mutual funds, pension funds, insurance companies, banks, and the Federal Reserve together hold over 70% of publicly held debt.

What Is Driving the Debt Higher?

The debt has grown from $5.67 trillion in 2000 to $39 trillion today because annual spending consistently exceeds annual revenue. Four structural factors drive this imbalance, and none of them are temporary:

1. An aging population. The baby boom generation (born 1946–1964) is retiring at a rate of 10,000 people per day through 2030. Each retiree shifts from being a taxpayer to being a beneficiary of Social Security and Medicare, simultaneously reducing revenue and increasing mandatory spending. The 2025 Social Security Trustees Report projects the retirement trust fund will be depleted by 2033.

2. Rising healthcare costs. Medicare, Medicaid, and ACA subsidies collectively consume over 25% of federal spending. Healthcare costs grow faster than GDP because medical technology advances, drug prices increase, and an aging population requires more intensive care.

3. Compounding interest. Interest on the debt is now the fastest-growing federal expense. At $1 trillion annually, it exceeds the defense budget. Worse, interest payments generate new debt (the government borrows to pay interest), creating a feedback loop. Every 1% increase in the average interest rate adds approximately $310 billion in annual interest costs.

4. Insufficient tax revenue. Federal revenue averages about 17–18% of GDP while spending exceeds 23% of GDP. The gap persists regardless of which party controls Congress. For details, see our Federal Spending & Revenue page.

How the Debt Affects Your Borrowing Costs

The national debt and the prime rate (currently 6.75%) are connected through Federal Reserve policy. When the government borrows heavily, it floods the bond market with Treasury securities, pushing yields higher. Higher Treasury yields put upward pressure on mortgage rates (tied to the 10-year Treasury), while the Fed’s response to fiscal conditions affects the federal funds rate — and therefore the prime rate that controls credit card APRs, HELOCs, and SBA loan rates.

Since September 2024, the Fed has cut the federal funds rate five times (from 5.25%–5.50% to 3.50%–3.75%), bringing prime from 8.50% to 6.75%. This has lowered variable-rate borrowing costs — credit card APRs dropped from ~23% to ~21%, HELOCs declined by 1.75%, and new personal loan offers improved. However, 10-year Treasury yields have actually risen during this period because bond investors are pricing in persistent fiscal deficits.

Frequently Asked Questions

What is the current US national debt?

As of March 26, 2026, the total U.S. national debt is $38,990,389,667,489 (approximately $39 trillion). This includes $31.36 trillion in debt held by the public and $7.63 trillion in intragovernmental holdings. The figure is updated daily by the Treasury Department’s Debt to the Penny dataset.

How much national debt per person?

With a U.S. population of approximately 331.5 million, each citizen’s share of the national debt is roughly $117,631. Per taxpayer (approximately 140 million individual returns filed annually per IRS data), the share rises to about $278,503. Per household (~130 million households), the share exceeds $300,000.

How fast is the national debt growing?

Based on the 30-day rolling average from Treasury data, the debt grows by approximately $11.8 billion per day, $492 million per hour, and $136,747 per second. This pace reflects annualized budget deficits exceeding $2 trillion.

What is the US debt-to-GDP ratio?

The current debt-to-GDP ratio is approximately 133.4%, meaning the government owes 1.33 times the entire annual economic output of the country. The U.S. crossed the 100% threshold in 2013. Among major economies, only Japan (230%) has a higher ratio.

Who owns the US national debt?

Of the $31.36 trillion held by the public, approximately 70% is held domestically (mutual funds, the Federal Reserve at ~$4.9T, pension funds, banks, individuals) and 30% by foreign entities. Japan (~$1.1T) and China (~$760B) are the largest foreign holders.

How does the national debt affect interest rates?

Heavy government borrowing pushes Treasury yields higher, which raises mortgage rates (tied to the 10-year Treasury) and puts upward pressure on all borrowing costs. The prime rate (6.75%) is set by the Fed in response to economic conditions that include fiscal policy. When debt grows faster than GDP, yields tend to rise even if the Fed cuts short-term rates.