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Uncle Sam has published its latest financial report and it doesn’t look good.
Treasury Secretary Scott Bessent recently warned that the United States is on an “unsustainable fiscal trajectory” due to massive government spending and high debt (1). Treasury reports total assets of $6.1 trillion versus total liabilities of $47.8 trillion as of September 30, 2025 (2). In other words, the net worth of the government is negative 41.7 trillion USD.
Worse still, this estimate of total debt does not include the unfunded obligations of social insurance programs like Social Security and Medicare. That debt is reported separately, keeping it off the federal government’s core balance sheet.
According to estimates published by Fortune, Johns Hopkins economist Steve Hanke and former US Comptroller David Walker estimate that, over a 75-year period, those unfunded liabilities could be worth $88.4 trillion (3). Add to that a $41.7 trillion shortfall on the Federal government’s core balance sheet and you have total liabilities of a whopping $130 trillion.
Here’s what all these astronomical numbers mean for your personal finances in the years to come.
Uncle Sam’s huge financial gap must be bridged somehow. There are only a few options, none of which can satisfy the average American taxpayer.
For example, increasing taxes could provide the government with some additional revenue to manage this debt burden over time. In 2024, legendary investor Warren Buffett predicted a long-term increase in corporate taxes would help reduce some of the government’s fiscal deficit (4).
Restructuring the social safety net could be another option.
According to the Brookings Institution, raising the retirement age, capping benefits for high-income households or expanding legal immigration to attract more young people to contribute to the trust fund would somewhat close the gap in the Social Security trust fund.
Unfortunately, many of these solutions can be frustrating for ordinary workers and savers. You may need to plan for higher taxes or a delayed retirement to prepare for any potential future government moves.
But you don’t have to navigate this uncertain and uncomfortable future on your own.
Advisor.com can help connect you with an experienced professional tax advisor who has an eye on many of these potential policy ideas.
A savvy planner can help you prepare for the worst by optimizing your tax efficiency and investment strategy.
Finding the right advisor isn’t easy, but Advisor.com lets you set up a free initial consultation with no obligation to hire to see if someone in their network is right for you.
An advisor can also help you prepare for another factor that affects your wallet just as much as the government does: inflation.
Read more: Taxes are changing under Trump’s ‘big, beautiful bill’ – 4 reasons why retirees can’t waste their time
This may seem counterintuitive, but inflation actually helps borrowers. As the value of money decreases, liability becomes less of a burden over time.
So if you assume a steady annual inflation rate of 3% for the next 75 years, Hanke and Walker’s estimated $88.4 trillion in unfunded debt could be worth nine times less in real terms by the end of the century.
According to researchers at Johns Hopkins University, this has happened in the past – the US debt-to-GDP ratio fell from 106% in 1946 to 23% in 1974, mainly due to inflation during that period.
Unfortunately, this means that ordinary families face not only high taxes but also persistent inflation.
You can try to avoid this loss of purchasing power by keeping your uninvested cash in an account that can keep up with inflation.
A high-yield account like the Wealthfront Cash Account can be a great place to grow your uninvested cash, offering both competitive interest rates and easy access to your money when you need it.
The Wealthfront Cash Account currently offers a base APY of 3.30% through program banks, and new clients can receive an additional 0.75% increase for the first three months on up to $150,000 for a total variable APY of 4.05%.
This is 10 times the national savings rate, according to the FDIC’s March report.
Additionally, Wealthfront is offering new clients who make direct deposits (minimum $1,000/month) into their Cash Account and open and fund new investment accounts a 0.25% APY increase with no expiration date or balance limit, meaning your APY can be as high as 4.30%.
With no minimum balance or account fees, as well as 24/7 withdrawals and free domestic bank transfers, your money is always accessible. Additionally, you have access to FDIC Insurance eligibility up to $8 million through the program’s banks.
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CNBC (1) Government Accountability Office (2) Fortune (3) Reuters (4) Brookings Institution (5) John Hopkins (6)
This article is for information only and should not be construed as advice. It is provided without warranty of any kind.
