As of February 2026, the United States owed roughly $38.79 trillion, and the money is owed to a mix of outside creditors and the government’s own internal accounts. About $31.13 trillion is held by the public — everyone from American retirees with savings bonds to the government of Japan — and about $7.66 trillion is intragovernmental, meaning one part of the federal government owes it to another.1U.S. Treasury Fiscal Data. Debt to the Penny So when people ask who the US owes money to, the honest answer is: itself, its central bank, its own citizens and businesses, and a long list of foreign governments and investors. Here is how those groups break down.
Federal Trust Funds
The single largest category of internal creditors is the network of federal trust funds that hold money collected for specific programs. Together they hold about $7.66 trillion in special-issue Treasury securities.1U.S. Treasury Fiscal Data. Debt to the Penny These securities earn interest but cannot be traded on the open market. Federal law requires it: the Secretary of the Treasury must invest any trust fund balance not needed for current withdrawals in interest-bearing obligations of the United States.2Office of the Law Revision Counsel. 26 USC 9602 – Management of Trust Funds
The Social Security trust funds are the biggest internal creditor, holding about $2.8 trillion in Treasury securities as of fiscal year 2024.3U.S. Department of the Treasury. Financial Report of the United States Government For decades, payroll taxes brought in more than the program paid out, and those surpluses were lent to the rest of the federal government in the form of Treasury securities.4Social Security Administration. What Are the Trust Funds The Medicare trust funds hold another $399.4 billion.
Two other large internal creditors are retirement accounts for federal workers: the Civil Service Retirement and Disability Fund, managed by the Office of Personnel Management, and the Military Retirement Fund at the Department of Defense.5Office of the Law Revision Counsel. 5 USC 8348 – Civil Service Retirement and Disability Fund DoD also maintains a separate fund for healthcare benefits owed to Medicare-eligible military retirees.6Trump White House Archives. Trust Funds and Federal Funds
Because the money in these accounts came from taxes and premiums the government already collected, this kind of debt is different in character from money borrowed from outside investors. It still has to be repaid when the trust funds need it. Social Security has already reached the point where it redeems Treasury securities to cover the gap between incoming payroll taxes and outgoing benefits, and the 2025 Trustees Report projects the Old-Age and Survivors Insurance Trust Fund can pay full scheduled benefits only until 2033.7Social Security Administration. Trustees Report Summary
The Federal Reserve
The Federal Reserve held approximately $4.32 trillion in Treasury securities as of late February 2026, making it one of the single largest creditors of the United States.8Board of Governors of the Federal Reserve System. Factors Affecting Reserve Balances – H.4.1 Although the Fed is a government-created institution, its Treasury holdings count as debt held by the public because it operates outside the federal government’s own accounts.9Board of Governors of the Federal Reserve System. FEDS Notes – Federal Debt in the Financial Accounts of the United States
The Fed buys Treasury securities on the secondary market as part of its monetary policy operations, and it earns interest on what it holds. By law, it turns over its excess earnings to the Treasury after covering operating costs, dividends to member banks, and interest on its own liabilities.10Congressional Budget Office. Recent Changes to CBO Projections of Remittances From the Federal Reserve Those remittances effectively reduce the net cost of the portion of the debt the Fed holds.
The size of the Fed’s portfolio moves with policy. Starting in June 2022, the Fed began shrinking its holdings by letting maturing securities roll off without reinvestment, and total securities holdings fell by more than $2.2 trillion over that period, including about $1.6 trillion in Treasuries. The Federal Open Market Committee announced on October 29, 2025, that it would stop the runoff effective December 1, 2025, and resume rolling over all maturing Treasury securities at auction.11Board of Governors of the Federal Reserve System. Policy Normalization
Domestic Investors and Institutions
A large share of the debt held by the public sits with American individuals and institutions that treat Treasury securities as safe, reliable holdings. This group includes:
- Mutual funds, which pool investor money and buy Treasuries as low-risk components of broader portfolios.
- Private pension funds, which use Treasuries to generate steady returns for future retirees.
- Insurance companies, which hold them as stable assets against long-term policy obligations.
- State and local governments, which park surplus revenue in Treasuries for short-term cash management.
- Commercial banks, which hold Treasuries partly to satisfy liquidity coverage ratio requirements that mandate a cushion of high-quality liquid assets.12eCFR. 12 CFR 249.10 – Liquidity Coverage Ratio
Individual retail investors also lend directly to the government. You can buy savings bonds and marketable Treasury securities on TreasuryDirect without going through a broker.13TreasuryDirect. Buying a Treasury Marketable Security Many more Americans hold government debt indirectly, through 401(k) accounts, IRAs, or brokerage portfolios that include bond funds. If you own a bond fund, some slice of it is almost certainly Treasury securities. Interest earned on Treasuries is subject to federal income tax but exempt from state and local income taxes.14Internal Revenue Service. Topic No. 403 – Interest Received
Foreign Governments and Entities
Foreign creditors hold a significant portion of the public debt. The Treasury Department tracks these holdings through the Treasury International Capital reporting system.15U.S. Department of the Treasury. Description of the Treasury International Capital (TIC) System As of December 2025, the largest foreign holders were:
- Japan: $1,185.5 billion
- United Kingdom: $866.0 billion
- China: $683.5 billion
- Belgium: $477.3 billion
- Canada: $468.1 billion
- Luxembourg: $435.1 billion
Foreign central banks and sovereign wealth funds buy Treasuries in large part because the U.S. dollar is the world’s dominant reserve currency and the Treasury market is the largest and most liquid bond market in existence. Holding dollar-denominated assets helps these countries manage their own exchange rates and maintain reserves they can draw on during financial emergencies.
The country-level figures come with a caveat worth knowing. The TIC system records holdings based on where the transaction occurs, not necessarily where the ultimate owner lives. A security purchased through a financial center like London, Luxembourg, or Belgium may actually belong to an investor in another country.15U.S. Department of the Treasury. Description of the Treasury International Capital (TIC) System That is why smaller financial hubs sometimes appear near the top of the list.
What It Costs to Owe All These Creditors
Every creditor described above — trust funds, the Fed, domestic investors, and foreign holders — earns interest on the Treasury securities it holds, and the government has to pay it. The Congressional Budget Office projected net interest payments of roughly $1 trillion in fiscal year 2026, an increase of about $69 billion (7%) over 2025, equal to about 3.3% of GDP.17Congressional Budget Office. The Budget and Economic Outlook – 2026 to 2036
The interest bill grows for two reasons. Total outstanding debt keeps rising, and when interest rates are higher, each newly issued or refinanced security costs the government more. The primary deficit — spending minus revenue before interest costs — was projected at 2.6% of GDP for 2026, so interest alone now accounts for a large share of the total budget deficit.18Congressional Budget Office. The Budget and Economic Outlook – 2026 to 2036 That is what it currently costs the United States to owe money to the people, institutions, and governments listed above.