Explainers

U.S. federal debt basics: borrowing, Treasury securities and interest

Six foundations. Terms defined in plain English, each linked to an official source.

The national debt

$40.594 trillion

Gross federal debt, October 29, 2026

Gross federal debt (the headline): $40.594 trillion · 100%
Debt held by the public: $32.712 trillion · 80.6%
Intragovernmental holdings: $7.881 trillion · 19.4%

When people say “the national debt,” they usually mean gross federal debt—the full amount shown by the national debt clock. Economists often focus on debt held by the public because that is the portion financed in credit markets. Intragovernmental debt is money Treasury owes to federal accounts such as trust funds. Both are real obligations, but they answer different questions.

Why our number may differ from other sites: some sites quote only debt held by the public (about $32.7 trillion). LastTrillion leads with gross federal debt because that is what most people mean by “the national debt.”

Source: U.S. Treasury, Debt to the Penny, October 29, 2026. Parts are rounded separately.

Plain-English glossary

The annual return investors demand for lending money to the government — called the yield.
Paying off debt that has come due by borrowing again — called refinancing.
The date a bond must be repaid — called its maturity.
One-hundredth of one percentage point (100 of them make 1 percentage point) — called a basis point.
Federal debt owed to investors outside the government's own trust funds — called debt held by the public.
The gap between spending and revenue, not counting interest payments — called the primary deficit.
How much investors want to buy when Treasury sells new securities — called auction demand.
Dollars bid for each dollar of securities sold; higher generally means more buyers competing — called the bid-to-cover ratio.
The extra return investors may want for locking money into a long-term bond instead of a series of short-term ones — called the term premium.
Large-scale Federal Reserve purchases of bonds to push down longer-term interest rates — called quantitative easing.
Everything the Federal Reserve owns (such as Treasuries) and owes (such as bank reserves) — called the Federal Reserve balance sheet.

Central explainerThe debt comes due in waves →

What federal debt is

When the government spends more than it collects in a year, it runs a deficit and borrows the difference. Federal debt is the accumulated total of that borrowing. Part is held by the public (investors, banks, foreign governments, the Federal Reserve); part is held by government trust funds.

Source: Treasury Fiscal Data: Debt to the Penny

Treasury bills, notes, and bonds

These are IOUs the Treasury sells. Bills mature in a year or less, notes in two to ten years, and bonds in twenty or thirty years. TIPS adjust for inflation; floating-rate notes reset with short-term rates.

Source: TreasuryDirect: Treasury marketable securities

Who buys U.S. Treasury securities

Buyers include U.S. households and funds, banks, insurers, pension plans, state and local governments, the Federal Reserve, and foreign governments and investors.

Source: Treasury International Capital (TIC) data

How auctions and yields work

Treasury sells securities at regular public auctions. Bidders state the annual return they will accept for lending money to the government — called the yield; the auction clears at the yield needed to sell the full amount. A yield is the annual return an investor earns — and the government's borrowing cost on that security.

Source: TreasuryDirect: How auctions work

Why maturities and refinancing matter

When a security matures, Treasury usually repays it by issuing new debt at today's rates. Shorter average maturities mean interest costs adjust faster when rates rise or fall.

Source: Treasury: Quarterly Refunding

How interest expense enters the budget

Interest on the debt is a mandatory cost — it is paid automatically and competes with other priorities in the budget. CBO projects it as a share of spending and of GDP.

Source: Congressional Budget Office: Budget and Economic Outlook