Who Owns the U.S. Debt? 💵 | Stewardship Concepts Financial Advisors

Happy Friday!

Jenny and I (Noah) had a great Easter weekend—church in the morning, followed by brunch with family. Always good to be with family.

Today’s a bit of a milestone—this is my first time sending out the blog directly through Mailchimp. My goal is to make it easier for you to read everything right in your inbox. If you have any feedback, I’d love to hear it! Let's dive into a two-minute look at the economy, an interesting story, and a financial planning secret.

Economy – Slowing Down

After years of growth fueled by easy money and deficit spending, the U.S. economy is entering a new phase of uncertainty and restraint. In the first quarter, businesses rushed to import goods ahead of looming tariffs, but long-term adjustments will require clearer trade policies. With fiscal policy turning contractionary, monetary policy tightening, and mixed signals from consumer spending, investment, housing, and government purchases, real GDP growth is expected to come in at just 0.3%. The economy appears to be slowing, with more challenges ahead. Still, resilient business investment and steady service spending offer underlying strength that could support growth in the coming quarters.

Interesting Story – Who Owns the U.S. Debt?

Despite rising concerns, the latest data shows that foreign demand for U.S. debt remains strong, with foreign holdings hitting $8.8 trillion. While Japan and China remain the largest individual foreign holders, their shares have steadily declined over the past two decades. U.S. federal debt—now totaling $36.2 trillion—is primarily owned domestically, with the U.S. government holding about one-third, and domestic investors such as mutual funds, banks, and pensions accounting for over 40%. Foreign entities, often the subject of political debate, hold just under 25% of the total.

Financial Planning Secret – Roth Conversions Are Retirees' Version of “Buying the Dip”

Just like investors look for opportunities to buy low-priced stocks, retirees can use market downturns or temporarily low-income years to convert traditional IRA or 401(k) funds into a Roth IRA at a reduced tax cost. When account values are down, converting those depressed assets means paying taxes on a smaller amount, while all future growth and withdrawals can be tax-free. This strategy is especially powerful in early retirement, before required minimum distributions (RMDs) begin, or during low-income years. As financial advisors, we identify the timing and tax impact of Roth conversions as part of a long-term retirement income plan. With the right guidance, Roth conversions turn market volatility into a tax-saving opportunity.