THE NO-COMPROMISE RETIREMENT PLAN • 17
The government wants — and needs — low interest rates. The U.S. government has a big incentive to help keep interest rates low: It reduces the federal government’s debt payments. An increasingly large portion of our federal budget each year goes to paying interest on the U.S. debt. In 2010, 6 percent of our federal budget was dedicated to debt service, or around $209 billion. By 2035, the Congressional Budget Office projects debt service will grow to 25 percent of the budget, or around $2.27 trillion. As this book is written, the federal government is borrowing and repay- ing money at very low interest rates. If those rates rise, so does our national debt. Consider: Between 2011 and 2013, the gross federal debt rose more than $3 trillion. If interest rates had been just 1 percent higher during that time, the government would owe an additional $30 billion in interest each year. On June 1, 2005, the total national debt was $7,775,753,817,632.01. Ten years later, June 1, 2015, it was
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