Federal spending by purpose (budget function) — what the money is for

What the data shows

Across all federal spending by purpose (FY2025), the largest function is Medicare (≈$1.84T, 18.1% of the total here).
Benefits and entitlements (Medicare, Social Security, Health, Income Security) plus net interest dominate — most federal money is mandatory, not discretionary.

How to read

Budget functions group federal spending by purpose rather than by agency — Medicare, Social Security, National Defense, Net Interest, and so on. They reveal that most federal money is mandatory: benefits and entitlements (Medicare, Social Security, Health, Income Security) plus interest on the debt dwarf discretionary spending like defense's share. Reading by function shows what the government actually buys for the public, across agency lines.

Federal spending by function

#	Function (purpose)	Amount	Share
1	Medicare	≈$1.84T	18.1%
2	Social Security	≈$1.67T	16.5%
3	National Defense	≈$1.42T	14%
4	Net Interest	≈$1.25T	12.4%
5	Health	≈$1.15T	11.3%
6	Income Security	≈$759.05B	7.5%
7	General Government	≈$511.43B	5%
8	Veterans Benefits and Services	≈$413.32B	4.1%
9	Education, Training, Employment, and Social Services	≈$221.51B	2.2%
10	Transportation	≈$197.81B	2%
11	Natural Resources and Environment	≈$133.41B	1.3%
12	Administration of Justice	≈$115.35B	1.1%
13	Community and Regional Development	≈$106.47B	1.1%
14	Commerce and Housing Credit	≈$95.85B	0.9%
15	Agriculture	≈$73.45B	0.7%
16	International Affairs	≈$71.58B	0.7%
17	Energy	≈$63.24B	0.6%
18	General Science, Space, and Technology	≈$47.64B	0.5%

Only standard function categories are listed (unclassified excluded). Share is of the listed total. Amounts are obligations for the latest completed fiscal year.

Federal spending by object class (nature of spending)

The same spending split by what it pays for — grants/benefits, contractual services and supplies, personnel, asset acquisition.

Object class (nature)	Amount	Share
Grants and fixed charges	≈$7.39T	73.1%
Contractual services and supplies	≈$1.2T	11.9%
Personnel compensation and benefits	≈$872.32B	8.6%
Other	≈$350.47B	3.5%
Acquisition of assets	≈$298.61B	3%

FAQ

What is "by function"? How does it differ from by-agency?

Budget functions group spending by purpose (Medicare, defense, education, etc.). Unlike by-agency (which office spent it), a purpose that spans multiple agencies is combined into one.

Why do benefits and entitlements rank highest?

Medicare, Social Security, Health (Medicaid), and Income Security are "mandatory" spending — eligibility is set in law and payments flow automatically. Together with interest on the debt, they make up most federal spending, exceeding discretionary spending (parts of defense and various programs) adjusted each year in appropriations.

What do the amounts represent?

Federal spending (obligations) by function for the latest completed fiscal year. Source: U.S. spending data, USAspending.

How does this differ from the contracts/grants rankings?

This is "totals by purpose"; the contracts and grants rankings are "who received it" (companies, institutions, states). Together they show, in three dimensions, what money is for and who it flows to.

Related data

Sources (primary)

Source: USAspending (DATA Act open data, public domain). This site is not an official U.S. government source.

USAspending — Budget Function

Gov spending →