# Net Debt Per Capita: What It Means, How It Works, and Significance

## What Is Net Debt Per Capita?

Net debt [per capita](https://www.investopedia.com/terms/p/percapita.asp) is a measurement of the value of a government's debt expressed in terms of the amount attributable to each citizen under the government's jurisdiction.

The level of net debt per capita can be a factor to consider when analyzing a government's ability to continue to pay its debt service costs through its current levels of tax revenue.

### Key Takeaways

*   Net debt per capita is calculated by dividing a jurisdiction's total debt by the number of people living within it.
*   Net debt per capita is one way to assess the level of government debt.
*   This statistic is often used to make a political statement about current fiscal policy rather than as a true economic indicator.

## Understanding Net Debt Per Capita

Net debt per capita is how much debt a government has per citizen. It is most often calculated at the national level, but it can also be applied to state and city governments.

This number is sometimes used to help evaluate the [default risk](https://www.investopedia.com/terms/d/defaultrisk.asp) of a government's bonds as well as to assess its overall economic health.

Net debt per capita is a simple calculation to perform. The formula is:

Net Debt Per Capita = (Short-Term Debt + Long-Term Debt – Cash & Cash Equivalents)/Population

For example, if a country with a population of 300 million people has a total debt of $950 billion and cash of $20 billion, its net debt per capita is:

Net Debt Per Capita = ($950 Billion – $20 Billion)/300 Million = $3,100

These numbers can usually be obtained without the effort of gathering the data and calculating it. Many public sources and economic think tanks regularly publish the figures.

### $34.01 Trillion

...The U.S. national debt at the start of 2024. The figure is updated daily on the U.S. Treasury site. Ten years earlier it was $22.99 trillion.

### What the Number Means

Theoretically, the net debt per capital number means that each taxpayer would have to pay the government $3,100 if it had to pay off its debt in full. This is assuming, of course, that every citizen became liable for the outstanding debt of the country, which wouldn't happen in practice.

Net debt per capita is simply an indicator by which to measure a country's financial health rather than an actual approximation of individual liability.

## Significance of Net Debt Per Capita

Net debt per capita is more commonly used for political statements than as an economic indicator in and of itself. Expressing the national debt in terms of a citizen's share makes it more real and relevant.

As of Jan. 6, 2024, the net debt per capita of the United States is $102,409. Countries with higher net debt per capita include the United Kingdom and The Netherlands. Japan has a relatively light debt load.

These figures are generally used in domestic politics to push for some change in [fiscal policy](https://www.investopedia.com/terms/f/fiscalpolicy.asp). That said, net debt per capita may be plotted against [per capita GDP](https://www.investopedia.com/terms/p/per-capita-gdp.asp) to compare several regions around the world to determine the most promising areas to invest in internationally. However, the [debt to GDP ratio](https://www.investopedia.com/terms/d/debtgdpratio.asp) is more commonly used for this purpose as it simplifies two data sets into a single plotted line for each country. This makes visualization and comparison much easier.

## What Is the National Debt Per Capita of the U.S.?

The national debt of the U.S. is about $34 trillion as of the start of 2024.

The population of the U.S. is about 332 million.

That makes the national debt per capita of all Americans about $102,409.

## Why Is the U.S. National Debt Rising So Rapidly?

The U.S. national debt stands at about $34 trillion as of early 2024. Ten years earlier, it was $22.99 trillion. . at the start of 2024. The figure is updated daily on the U.S. Treasury site. Ten years earlier it was $22.99 trillion. Much of the increase can be attributed to the coronavirus pandemic and the enormous amounts of government money spent by both President Donald Trump and President Joe Biden to stabilize the American economy and help citizens through the crisis.

## Does Any Country Not Have National Debt?

Yes. Several nations have little or no debt. They include:

*   Norway, which has vast oil and gas reserves.
*   Singapore, a major financial center with a prosperous population.
*   Russia. which has avoided debt since its 1998 bankruptcy.

## The Bottom Line

National debt per capita is largely a political talking point. It helps communicate a government's level of indebtedness so that its citizens can understand it more fully.

Theoretically, every man, woman, and child in the U.S. would have to pay the U.S. government $102,409 to wipe out the national debt. Practically speaking, that's not going to happen.

> **Article Sources**
>
> 1.  U.S. Department of the Treasury. "[What is the national debt?](https://fiscaldata.treasury.gov/americas-finance-guide/national-debt/#:~:text=What%20is%20the%20national%20debt,accumulated%20over%20the%20nation's%20history.&text=Updated%20daily%20from%20the%20Debt%20to%20the%20Penny%20dataset.)"
>     
> 2.  U.S. Department of the Treasury. "[What is the national debt?](https://fiscaldata.treasury.gov/americas-finance-guide/national-debt/#:~:text=What%20is%20the%20national%20debt,accumulated%20over%20the%20nation's%20history.&text=Updated%20daily%20from%20the%20Debt%20to%20the%20Penny%20dataset.)"
>     
> 3.  Clear Finances. "[10 Countries without Public Debt](https://www.clearfinances.net/countries-without-public-debt/)."