US Federal Budget and Spending: Key Facts and Statistics for 2024-2025
A comprehensive guide to federal spending, deficits, national debt, and fiscal outlook
Key Takeaways
- Federal deficit was $1.8 trillion in both FY 2024 and FY 2025 (6.4% and 5.9% of GDP)
- Total US national debt reached $37.6 trillion (FY 2025), $38.4 trillion as of December 2025
- Interest on debt increased 83% from $497 billion (FY2022) to $909 billion (FY2024)
- CBO projects federal deficits will total $20 trillion over 2025-2034
- Social Security: ~23% of budget; Medicare/Medicaid: ~24%; Defense: ~13%
- Federal healthcare spending will grow from $1.6 trillion (FY2024) to $2.8 trillion by 2034
Federal Deficit: FY 2024 and FY 2025
The federal deficit—the annual amount the government spends beyond what it collects in revenue—remained elevated in recent fiscal years. The federal deficit was $1.8 trillion in both FY 2024 and FY 2025, representing 6.4% and 5.9% of GDP respectively 1.
The Congressional Budget Office (CBO) tracks these figures as the primary federal scorekeeper for budget projections 2. The Bipartisan Policy Center’s Deficit Tracker provides independent verification and historical context 3.
Deficit Context
These deficits reflect:
- Increased federal spending on social programs and defense
- Tax revenue fluctuations tied to economic conditions
- One-time spending packages related to pandemic recovery and infrastructure
- Structural imbalances between spending commitments and revenue
The American Action Forum’s analysis confirms these figures and provides additional economic context 4.
Total National Debt
The national debt—the cumulative total of all federal borrowing—has reached unprecedented levels. Total US national debt reached $37.6 trillion at the end of FY 2025 and $38.4 trillion as of December 2025 5.
This figure represents:
- Debt held by the public (Treasury securities owned by individuals, corporations, and foreign governments)
- Intragovernmental holdings (trust funds like Social Security)
The US GAO products provide detailed debt accounting 6. The Senate Joint Economic Committee tracks debt numbers for congressional oversight 7.
The St. Louis Fed’s FRED database provides historical debt data showing the trajectory over time 8.
Debt as Percentage of GDP
When measured against the size of the economy, the debt-to-GDP ratio provides context for sustainability. The CBO projects federal debt will reach 116% of GDP over the coming decade, a level not seen since World War II 9.
Interest on the National Debt
The interest payments on federal debt represent one of the fastest-growing budget categories. Interest on debt held by the public increased from $497 billion in FY2022 to $909 billion in FY2024—an 83% increase 10.
This rapid growth reflects:
- Higher interest rates following Federal Reserve policy changes
- Larger debt balances requiring more servicing
- Refinancing of older debt at current higher rates
The Committee for a Responsible Federal Budget notes that interest costs have “just surpassed defense and Medicare” as a spending category 11. Fiscal Data from Treasury provides current interest projections 12.
Impact on Federal Budget
Rising interest costs crowd out other spending priorities and represent a growing claim on tax revenue. This “interest trap” makes deficit reduction more difficult over time.
Major Spending Categories
The federal budget is divided into major categories, each representing different policy priorities:
Mandatory Spending (2024)
Mandatory spending programs continue to dominate the federal budget, totaling $4.1 trillion in 2024 13:
| Category | Percentage of Budget |
|---|---|
| Social Security | ~23% |
| Medicare/Medicaid | ~24% |
| Other Mandatory | ~10% |
Medicare spending reached $912 billion, providing coverage to approximately 67 million people 15.
Discretionary Spending
Discretionary spending—funding that must be appropriated annually—represents approximately 27% of the federal budget 16. This includes:
- Defense Department
- Education
- Transportation
- Scientific research
- Federal law enforcement
The Peterson Foundation provides a comprehensive federal budget guide explaining these categories 17.
Defense Spending
Defense spending accounts for approximately 13% of federal spending 18. This includes:
- Department of Defense operations
- Military personnel
- Weapons procurement
- Veterans’ benefits
Projected Deficits and Debt Over the Next Decade
The CBO’s long-term projections paint a challenging fiscal picture. Federal budget deficits are projected to total $20 trillion over the 2025-2034 period 19.
Key drivers of future deficits include:
- Demographic changes (aging population increasing Social Security and Medicare costs)
- Healthcare cost growth outpacing general inflation
- Interest costs on existing debt
- Policy decisions about taxation and spending
The NBER’s digest of these projections provides academic context for the CBO’s analysis 20.
Healthcare Spending Growth
Federal healthcare spending is projected to grow substantially. According to the Committee for a Responsible Federal Budget, federal healthcare programs will grow from $1.6 trillion in FY2024 to $2.8 trillion by 2034 21.
This category includes:
- Medicare (for seniors 65+)
- Medicaid (for low-income individuals)
- ACA subsidies (Affordable Care Act)
- CHIP (Children’s Health Insurance Program)
The US House Committee on the Budget noted that “government’s mandatory health care spending now exceeds entire discretionary budget” 22.
Frequently Asked Questions About US Federal Budget
What was the federal deficit in 2024 and 2025?
The federal deficit was $1.8 trillion in both FY 2024 (6.4% of GDP) and FY 2025 (5.9% of GDP).
How much is the national debt?
The total US national debt reached $37.6 trillion at end of FY 2025 and $38.4 trillion as of December 2025.
How much does the US pay in interest on the debt?
Interest payments increased 83% from $497 billion (FY2022) to $909 billion (FY2024).
What percentage of the federal budget goes to Social Security?
Social Security represents approximately 23% of the federal budget.
What percentage goes to Medicare and Medicaid?
Medicare and Medicaid combined represent approximately 24% of the federal budget.
How much is defense spending?
Defense spending accounts for approximately 13% of federal spending.
What are the projected deficits over the next decade?
The CBO projects deficits will total $20 trillion from 2025-2034, with debt reaching 116% of GDP.
How much will healthcare spending grow?
Federal healthcare spending is projected to grow from $1.6 trillion (FY2024) to $2.8 trillion by 2034.
How many people does Medicare cover?
Medicare provides coverage to approximately 67 million Americans.
What is mandatory vs. discretionary spending?
Mandatory spending (Social Security, Medicare) is automatically funded; discretionary spending must be annually appropriated by Congress.
Sources
- Congressional Budget Office – Budget Data
- CBO – Budget Outlook
- Bipartisan Policy Center – Deficit Tracker
- American Action Forum – FY 2025 Deficit
- US GAO – Debt Report (GAO-26-107908)
- US GAO Products
- Senate Joint Economic Committee – National Debt
- FRED St. Louis Fed – National Debt
- CBO – Budget Outlook 2025-2035
- US GAO – Interest Costs (GAO-25-107138)
- Committee for a Responsible Federal Budget – Interest Costs
- Fiscal Data Treasury – National Debt Guide
- CBO – Mandatory Spending (2024)
- CBPP – Where Federal Tax Dollars Go
- CRFB – Interest, Social Security, and Health Spending
- Peterson Foundation – Federal Budget Guide
- PGPF – Federal Budget Guide
- USAFacts – Government Spending Per Person
- CBO – Long-Term Budget Outlook
- NBER – Projecting Federal Deficits and Debt
- CRFB – Healthcare Spending Growth
- US House Committee on the Budget – Healthcare Spending
Last updated: March 2026
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