How Money Is Created in the U.S. — And What It Means for Your Savings 

The Hidden Math Behind Every Dollar in Your Wallet

As of early 2026, the United States carries approximately $39 trillion in national debt, according to the U.S. Treasury. The total M2 money supply — every dollar in savings accounts, checking accounts, and cash in circulation — stood at approximately $22.4 trillion as of January 2026, according to the Federal Reserve's H.6 release. These two numbers are worth understanding side by side, because they tell an interesting story about how the modern monetary system functions.

One way to understand it is this: modern credit systems depend on ongoing money creation, refinancing, and assumed economic growth, because total debt obligations can exceed the amount of money in circulation at any given time. Debt is not repaid all at once, it is managed over time through income, asset sales, and new borrowing. But the numbers do raise a fair question about what happens to the value of the dollars already in your pocket.

How Money Enters the System

When the federal government spends more than it collects in taxes, it issues Treasury securities that are purchased by investors, institutions, and sometimes the Federal Reserve in secondary market operations. Once that money reaches banks, it can be lent out further through a process called fractional reserve lending. In March 2020, the Federal Reserve reduced reserve requirements to zero. This removed one formal reserve constraint, though bank lending remains limited by capital requirements, credit demand, underwriting standards, liquidity, and risk management.

According to the U.S. Congress Joint Economic Committee, the national debt is currently growing at $87,685 every second, and $33,500 is added to the total money supply every second, based on the Federal Reserve's H.6 Money Stock Measures. Each new dollar added to the system can dilute the purchasing power of every dollar already in it, including the ones sitting in your savings account. This is why inflation is sometimes described by economists as "the silent tax on the American people."

What This Means for Your Savings

For illustration only: if purchasing power declined by 4.1% in a year, similar to recent higher-inflation periods, a $10,000 cash balance would lose roughly $410 of real purchasing power before accounting for interest earned. Actual inflation, savings yields, and purchasing power changes vary and depend on a range of economic factors. Based on Consumer Price Index data published by the U.S. Bureau of Labor Statistics, U.S. inflation has averaged roughly 3% per year over the long run, though actual inflation varies year to year. CPI measures changes in the prices consumers pay for a broad basket of goods and services and is commonly used as a benchmark for inflation and purchasing power.

The interest the government pays on its debt has nearly tripled in five years, from $345 billion in 2020 to over $1.2 trillion in 2025. That cost flows through the broader economy in ways that can affect consumers and savers over time.

Real Estate as an Inflation-Sensitive Asset

There is a category of asset that has historically responded differently to inflation than cash. Real estate is one of the most recognized examples.

A home has utility. People need somewhere to live regardless of broader economic conditions. The land it sits on cannot be created. The materials required to build it tend to cost more as prices rise across the economy. According to the Federal Reserve's All-Transactions House Price Index, U.S. real estate prices have historically grown at an average rate of 3 to 5% per year, often in line with or above inflation over the long term, though performance varies significantly by market, property type, timing, and broader economic conditions. Real estate can also underperform during certain periods, and past performance is not indicative of future results.

Rental income may also adjust over time with market conditions. As the cost of living rises, rents have historically tended to move in a similar direction. However, rent growth is not guaranteed and depends on local supply, demand, vacancy, and tenant affordability.

The Accessibility Problem — and How It's Changing

Traditionally, accessing real estate as an investment has required a large down payment, a mortgage, and the ongoing responsibilities of ownership. For most people, that barrier has grown alongside rising home prices.

A common alternative has been REITs. Real Estate Investment Trusts. REITs offer real advantages, including liquidity and diversification across a broad portfolio of properties. However, with a REIT you are investing in a fund managed by someone else, in markets and properties chosen by someone else. There is no individual property you can point to and say "that is mine" — no specific address, no specific tenant, no direct connection between the rent collected on a particular home and the income in your account.

Fractional real estate investing takes a different approach. You choose the property. You can see the address, the market, the projected income, and the purchase price relative to market value. The potential income traces back to a real lease on a real home, and the appreciation you may see over time is tied to a specific location you understood when you invested in it.

Realbricks is built around this model. Properties on the platform are acquired debt-free; no mortgage, no lender with a claim on the asset. While this structure reduces exposure to interest-rate and refinancing risk, it does not eliminate real estate, market, liquidity, operating, or loss-of-principal risks. Investors can own fractional shares of individual residential properties with as little as $100, and certain offerings include an estimated annual dividend based on local market conditions and underwriting assumptions. The quarterly dividends investors receive will be determined by the cash flow from the property, which is calculated as rental income minus operating expenses.

In periods when inflation exceeds the yield on cash savings, purchasing power can decline over time. For investors evaluating alternative investment opportunities, debt-free rental property shares are one option worth investigating. Historically, certain real assets with inherent utility—such as residential rental properties—have, in some periods, experienced price and income trends that differ from cash and may be influenced by broader economic conditions, including inflation, though outcomes vary and are not guaranteed.

If you are curious about how fractional real estate investing works and want to explore available properties, you can browse current offerings on the Realbricks platform. Signing up takes about five minutes.

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Investments are speculative and involve risk, including possible loss of principal. Please review the offering circular and all risk factors before investing. This article is for informational and educational purposes only and does not constitute investment advice or an offer to sell securities. All investments on the Realbricks platform are fractional ownership interests in an LLC. Dividends are not guaranteed and may be lower than projected or not paid at all. Past performance is not indicative of future results. Performance varies by property, market, timing, and broader economic conditions.