US debt interest payments to exceed $ 1 t in 2026

Tuesday, 6 January 2026 01:33 - - {{hitsCtrl.values.hits}}

The US Congressional Budget Office (CBO) estimates that annual interest costs are projected to increase from $ 881 billion in FY2024 to $ 1 trillion in FY2026, before rising further to almost $ 1.8 trillion by 2035.

Net interest is already one of the largest components of US Federal spending. In 2024, interest payments exceeded outlays on Medicare and national defence, ranking second only to Social Security. Over the past decade, interest costs have accelerated sharply, rising from $ 223 billion in 2015 to $ 345 billion in 2020 and nearly tripling to $ 881 billion in 2024.

For FY2025, the CBO projects net interest of $952 billion, equivalent to about 3.2% of GDP, close to a historic high. Interest costs are expected to surpass their previous peak as a share of the economy in 2026.

Over the next ten years, cumulative interest payments are projected to exceed total defence spending by around $ 4.3 trillion.