Americans face a mounting US debt household costs crisis after Treasury data confirmed the national debt has reached $40 trillion, with a new report modelling losses of hundreds of dollars a month for retirees and tens of thousands of dollars more for homebuyers.
The government is now projected to spend more than $1 trillion in interest on the debt in the fiscal year 2026 alone, according to Treasury figures.
The analysis, published by The Conference Board, models what continued borrowing at current levels would mean for ordinary household finances, covering mortgage costs, Social Security payouts and consumer debt burdens.
What US debt household costs mean for retirees
Workers approaching retirement stand to lose hundreds of dollars a month if Social Security and Medicare trust funds are depleted without government intervention.
The Conference Board reports that the reduction in monthly Social Security benefits in 2032 would be $173. By 2033, when the trust fund is projected to run dry, that rises to $705 a month. The shortfall reaches $721 by 2034 and $754 by 2036.
The Social Security trust fund is due to run dry in a little under eight years, and Medicare in a little under seven years, according to estimates by the Committee for a Responsible Federal Budget.
Should the Treasury choose to backfill those programmes from its general fund, the Congressional Budget Office puts that additional burden at $2.7 trillion.
Homebuyers face a $53,000 penalty under the baseline debt path
The Conference Board modelled the finances of a family buying a $600,000 home with a 20% down payment and a 30-year fixed mortgage, purchasing either in 2031 or 2036.
Under the baseline scenario, total payments over three decades come to $2.89 million for a 2031 purchase and $2.8 million for a 2036 purchase.
If the government were to cut deficits roughly in half, in line with current proposals, buyers in 2031 would save $53,000 in total repayments. Buyers in 2036 would save more than $100,000.
In the most extreme scenario modelled, an interest rate shock, The Conference Board projects mortgage rates rising to 7.8% in 2026, dipping slightly before climbing back to 7.7% by 2036. Under that scenario, total payments on the same home bought in 2031 rocket to more than $3 million. An outright US default would push payments above $3.6 million.
Rising delinquencies add to the pressure on households
The strain on consumer finances is already visible. A separate Conference Board data release shows the credit and loan delinquency rate stood at 4.44% in the first quarter of 2026, up 18 basis points from the previous quarter and up 40 basis points from one year earlier.
Michael Peterson, of the think tank the Peterson Institute, told Fortune the link between sovereign borrowing and household bills is direct.
‘When the U.S. borrows this much … that drives up interest rates, which then increases household expenses because your mortgage goes up, your car loan, your credit card bills, and inflation more generally,’ he said. ‘So [we] may not get a bill at the end of the month for national debt, but [we] are paying that bill both in the form of taxes as well as an inflated level of expenses.’
Peterson added that Social Security and Medicare are running out of cash, placing further pressure on government budgets in the near future.
The issue is rising up voters’ agendas ahead of midterms later this year.
The Conference Board concluded: ‘Neglecting the problem will not make it better and worsening our deficits will only increase the negative impacts of the debt on the rest of the economy … Addressing the national debt deserves to be a high priority for both voters and lawmakers, to benefit all Americans.’
