How High Are Federal Interest Payments? - March 10, 2021

How High Are Federal Interest Payments? March 10, 2021 This year, the federal government will spend $300 billion on interest payments on the national debt. [...] How Much Does the Federal Government Spend on Interest? Even with exceptionally low interest rates, the federal government is projected to spend just over $300 billion on net interest payments in fiscal year 2021. [...] Higher Interest Rates Would Increase Interest Costs As interest rates rise, the cost of debt service payments will grow. [...] The higher the federal debt, the more exposed the federal government is to interest rate risk. [...] Conclusion While interest rates on the national debt are low historically speaking, the sheer amount of debt means that the federal government still spends billions of dollars on interest payments every year.