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The U.S. Treasury Department headquarters building.<\/p>\n
This article adheres to strict editorial standards. Some or all links may be monetized.<\/p>\n
America\u2019s mounting debt has long raised concerns. But following the Treasury Department\u2019s latest report, some experts say the situation has reached a breaking point \u2014 the nation is now effectively \u201cinsolvent.\u201d<\/p>\n
\u201cThe U.S. government is insolvent. That\u2019s not hyperbole,\u201d wrote Steve Hanke, professor of applied economics at Johns Hopkins University and David M. Walker, former U.S. Comptroller General, in a recent Fortune op-ed (1).<\/p>\n
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New 2026 IRA rules are here. See how to protect your nest egg from inflation before the next tax deadline with physical gold. Get your free guide<\/a> from Priority Gold<\/p>\n<\/li>\n They pointed to newly-released Treasury financial statements showing that as of Sept. 30, 2025, the federal government held $6.06 trillion in total assets against a staggering $47.78 trillion in liabilities (2).<\/p>\n But even that figure doesn\u2019t tell the full story.<\/p>\n It excludes unfunded obligations tied to major social insurance programs like Social Security and Medicare. The 75-year unfunded social insurance obligation \u2014 the gap between projected spending and revenues \u2014 jumped by $10.1 trillion in the past fiscal year to $88.4 trillion. Add that to the official balance sheet liabilities, the authors noted, and total federal obligations would exceed $136.2 trillion.<\/p>\n At the same time, the government continues to spend far more than it brings in. In fiscal year 2025, federal revenue totaled $5.24 trillion, while spending reached $7.34 trillion.<\/p>\n To illustrate the scale, the authors suggest shrinking the numbers by eight zeros \u2014 and viewing federal finances like a \u201chousehold budget in freefall.\u201d<\/p>\n \u201cThat household earns $52,446 and spends $73,378 \u2014 running a $20,932 annual deficit. Its total liabilities and unfunded promises amount to $1,361,788 against just $60,554 in assets, leaving it $1.3 million in the hole. Uncle Sam, by any accounting standard, is insolvent,\u201d they wrote.<\/p>\n In their view, the U.S. is now \u201cfacing a fiscal catastrophe,\u201d with a long-deferred reckoning becoming impossible to ignore.<\/p>\n The figures are indeed alarming, but the U.S. may not be \u201cinsolvent\u201d in the traditional sense. Unlike a household or business, America is the issuer of the world\u2019s reserve currency \u2014 meaning it has the ability to create money to meet its obligations.<\/p>\n On that point, Ray Dalio, founder of the world\u2019s largest hedge fund, Bridgewater Associates, has warned<\/a> that the U.S. is heading toward a \u201cdebt death spiral\u201d \u2014 but he doesn\u2019t expect an outright default.<\/p>\n \u201cThere won’t be a default \u2014 the central bank will come in and we’ll print the money and buy it,\u201d he said. \u201cAnd that’s where there’s the depreciation of money.\u201d<\/p>\n In other words, the government may never technically run out of dollars \u2014 but those dollars can lose value fast.<\/p>\n In fact, the erosion in the value of the dollar is already visible. According to the Federal Reserve Bank of Minneapolis, $100 in 2025 has the same purchasing power as just $12.06 did in 1970 (3).<\/p>\n The good news? Savvy investors have long found ways to protect their wealth \u2014 even when Washington\u2019s fiscal math stops adding up.<\/p>\n A safe-haven shines again<\/p>\n To shock-proof your investments, Dalio emphasized the value of diversification \u2014 and highlighted one time-tested asset in particular.<\/p>\n \u201cPeople don’t have, typically, an adequate amount of gold in their portfolio,\u201d he said. \u201cWhen bad times come, gold is a very effective diversifier.\u201d<\/p>\n Gold has long been considered a go-to safe haven. It can\u2019t be printed out of thin air like fiat money and because it\u2019s not tied to any single currency or economy, investors often flock to it during periods of economic turmoil or geopolitical uncertainty, driving up its value.<\/p>\n Despite a recent pullback, gold prices have climbed more than 45% over the past 12 months.<\/p>\n Other prominent voices see further potential. JPMorgan CEO Jamie Dimon recently said<\/a> that in this environment, gold can \u201ceasily\u201d rise to $10,000 an ounce.<\/p>\n One way to invest in gold that also provides significant tax advantages is to open a gold IRA with the help of Priority Gold<\/a>.<\/p>\n Gold IRAs allow investors to hold physical gold or gold-related assets within a retirement account, thereby combining the tax advantages of an IRA with the protective benefits of investing in gold<\/a>, making it an option for those looking to help shield their retirement funds against economic uncertainties.<\/p>\n When you make a qualifying purchase with Priority Gold, you can receive up to $10,000 in precious metals<\/a> for free.<\/p>\n Read More: 5 essential moves to make once you\u2019ve saved $50,000<\/a><\/strong><\/p>\n A time-tested income play<\/p>\n Gold isn\u2019t the only asset investors turn to during inflationary times. Real estate has also proven to be a powerful hedge.<\/p>\n When inflation rises, property values often increase as well, reflecting the higher costs of materials, labor and land. At the same time, rental income tends to go up, providing landlords with a revenue stream that adjusts for inflation.<\/p>\n Over the past ten years, the S&P Cotality Case-Shiller U.S. National Home Price NSA Index has jumped by 87%, reflecting strong demand and limited housing supply (4).<\/p>\n Of course, high home prices can make buying a home more challenging, especially with mortgage rates still elevated. And being a landlord isn\u2019t exactly hands-off work \u2014 managing tenants, maintenance and repairs can quickly eat into your time (and returns).<\/p>\n The good news? You don\u2019t need to buy a property outright \u2014 or deal with leaky faucets \u2014 to invest in real estate today. Mogul<\/a> is a crowdfunding platform that offers an easier way to get exposure to this income-generating asset class.<\/p>\n It\u2019s a real estate investment platform offering fractional ownership in blue-chip rental properties<\/a>, which gives investors monthly rental income, real-time appreciation and tax benefits \u2014 without the need for a hefty down payment or 3 a.m. tenant calls.<\/p>\n Founded by former Goldman Sachs real estate investors, the team hand picks the top 1% of single-family rental homes nationwide<\/a> for you. In other words, you gain access to institutional-quality offerings for a fraction of the usual cost.<\/p>\n Each property undergoes a rigorous vetting process, requiring a minimum 12% return even in downside scenarios. Across the board, the platform features an average annual IRR of 18.8%. Offerings often sell out in under three hours<\/a>, with investments typically ranging between $15,000 and $40,000 per property.<\/p>\n You can sign up for an account and then browse available properties here<\/a>.<\/p>\n Another option is Lightstone DIRECT<\/a>, which offers accredited investors access to institutional-quality multifamily and industrial real estate \u2014 with a minimum investment of $100,000.<\/p>\n Founded in 1986 by David Lichtenstein, Lightstone Group is one of the largest privately held real estate investment firms in the U.S., with more than $12 billion in assets under management.<\/p>\n Over nearly-four decades, their team has delivered strong, risk-adjusted performance across multiple market cycles \u2014 including a 27.6% historical net IRR and a 2.54x historical net equity multiple on realized investments since 2004.<\/p>\n With Lightstone DIRECT, you gain access to the same multifamily and industrial deals Lightstone pursues with its own capital<\/a>.<\/p>\n Here\u2019s the kicker: Lightstone invests at least 20% of its own capital in every deal <\/a>\u2014 roughly four times the industry average. With skin in the game, the firm ensures its interests are directly aligned with those of its investors.<\/p>\n An overlooked alternative<\/p>\n Prominent investors like Dalio often stress the importance of diversification \u2014 and for good reason. Many traditional assets tend to move in tandem, especially during periods of market stress.<\/p>\n That message feels especially relevant today. Nearly 40% of the S&P 500\u2019s weight is concentrated in its ten largest stocks and the index\u2019s CAPE ratio hasn\u2019t been this high since the dot-com boom.<\/p>\n This is where, for many investors, alternative assets come into play. These can include everything from real estate and precious metals to private equity and collectibles.<\/p>\n But there\u2019s one store of value that routinely flies under the radar: It\u2019s scarce by design, coveted worldwide and frequently locked away by institutions.<\/p>\n We\u2019re talking about post-war and contemporary art \u2014 a category that has outpaced the S&P 500 with low correlation since 1995.<\/p>\n It\u2019s easy to see why art pieces often fetch new highs at auctions: The supply of the best works of art is limited and many of the most desirable pieces have already been snatched up by museums and collectors. That scarcity can also make art an attractive option for investors looking to diversify and preserve wealth during periods of high inflation.<\/p>\n Until recently, purchasing art has been a domain reserved for the ultra-wealthy \u2014 like in 2022 when a collection of art owned by the late Microsoft co-founder Paul Allen sold for $1.5 billion at Christie\u2019s New York, making it the most valuable collection in auction history (5).<\/p>\n Now, Masterworks \u2014 a platform for investing in shares of blue-chip artwork<\/a> by renowned artists, including Pablo Picasso, Jean-Michel Basquiat and Banksy \u2014 can help you get started with this asset class. It\u2019s easy to use and, with 27 successful exits to date, Masterworks has distributed more than $65 million in total proceeds (including principal).<\/p>\n Simply browse their impressive portfolio of paintings<\/a> and choose how many shares you\u2019d like to buy. Masterworks can handle all the details<\/a>, making high-end art investments both accessible and effortless.<\/p>\n New offerings have sold out in minutes, but you can skip their waitlist here<\/a>.<\/p>\n Note that past performance is not indicative of future returns. Investing involves risk. See Reg A disclosures at http:\/\/masterworks.com\/cd<\/a>.<\/p>\n You May Also Like<\/p>\n Turning 50 with $0 saved for retirement? Most people don\u2019t realize they\u2019re actually just entering their prime earning decade. Here are 6 ways to catch up fast<\/a><\/p>\n<\/li>\n Robert Kiyosaki issues grim warning for baby boomers. Many could be \u2018wiped out\u2019 and homeless \u2018all over\u2019 the country. How to protect yourself now<\/a><\/p>\n<\/li>\n<\/ul>\n Join 250,000+ readers and get Moneywise\u2019s best stories and exclusive interviews first \u2014 clear insights curated and delivered weekly. Subscribe now.<\/a><\/strong><\/p>\n Article sources<\/p>\n We rely only on vetted sources and credible third-party reporting. For details, see our editorial ethics and guidelines<\/a>.<\/p>\n Fortune (1<\/a>); Bureau of the Fiscal Service (2<\/a>); Federal Reserve Bank of Minneapolis (3<\/a>); S&P Global (4<\/a>); Christie\u2019s (5<\/a>)<\/p>\n This article provides information only and should not be construed as advice. It is provided without warranty of any kind.<\/p>\n","protected":false},"excerpt":{"rendered":"The U.S. Treasury Department headquarters building. This article adheres to strict editorial standards. 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