From CNBC: 2025-06-02 14:33:00

House Republicans passed a massive tax cut package expected to increase the U.S. debt by trillions. The bill faces scrutiny in the Senate this week. Estimates show the bill could add $3.1-3.8 trillion to the national debt. Some Republicans are concerned about the bill’s impact on the debt load.

The rising national debt can impact household finances by raising interest rates for consumer loans. The bill cuts taxes by $4 trillion, mostly benefiting the wealthy. Tariffs are seen as a way to offset tax cuts but are unreliable. Moody’s downgraded the U.S.’ credit rating in May due to the increasing deficit.

Higher U.S. debt could lead to higher interest rates for consumers, tied to perceptions of U.S. debt loads. Treasury yields are influenced by market forces. Investors may demand higher rates if the bill raises the debt and deficit. Moody’s downgrade signaled a bigger credit risk for investors.

A higher debt burden could mean higher borrowing costs for consumers. The debt-to-GDP ratio could impact Treasury yields. Rising yields can lead to losses for bondholders and impact investment portfolios. The House legislation could exacerbate existing debt problems and displeases the bond market.

Consumer financing costs have doubled in recent years and could rise further with increased debt. Treasury investors and yields are influenced by various factors. The U.S. debt burden, along with other concerns, has raised worries in financial markets. Economists warn that the House legislation would worsen existing debt issues.

Read more: What the national debt, deficit mean for your money