Study: States with the Highest Credit Card Debt-to-Income Ratios
One of the surprising financial developments during that pandemic is that average credit card debt actually declined thanks in part to Americans traveling less and using stimulus checks to pay down balances. However, with inflation and interest rates rising since then, balances have begun to rise once again. Recently, the site Upgraded Points released a new study looking at the credit card debt load of residents in the United States and ranking them according to a few credit factors.
According to the study’s figure, Florida residents had the highest average credit card debt-to-income (DTI) ratios. With debt per capita coming in at $3,450, the Sunshine State’s average DTI was 6.20%. That topped the second place Alaska’s 6.07%, although the Last Frontier’s credit card debt per capita (DPC) was the highest in the country at $4,070. Similarly, the District of Columbia’s DPC was found to be $4,040 — the second highest in the nation — although the 5.44% DTI was down in seventh place. Rounding out the top five states with the highest DTIs were Nevada (5.88%), Georgia (5.77%), and Texas (5.75%).
On the other end, Utah was the state with the lowest credit card debt-to-income ratio at 4.08%. The Beehive State was joined by West Virginia (4.23%), New Hampshire (4.30%), Oregon (4.31%), and Wisconsin (4.33%) at the bottom of the DTI list. Meanwhile, the state with the lowest credit debt per capita was actually Mississippi with a total of $2,150. Other states with low DPCs included West Virginia ($2,250), Kentucky ($2,290), Alabama ($2,370), and Arkansas ($2,380).
Turning to credit scores, the state with the highest average was Minnesota, coming in at 724. Vermont’s average wasn’t far behind at 721, followed by Massachusetts (720), New Hampshire (718), Wisconsin (717), and South Dakota (717). Unfortunately, despite Mississippi having the lowest credit card debt per capita, the Magnolia State also has the lowest average credit score at 662. Additionally, Louisiana’s average came in at 669, making it the only other state to come in below the 670 score threshold that credit bureaus consider to be “good” credit. Alabama (671), Georgia (674), and Texas (674) were also in the bottom five.
Overall, in a bit of good news, the national credit card debt per capita has remained quite steady over the past decade. While it has risen from the $2,950 observed in 2011, 2021’s total was only $110 higher at $3,060. Furthermore, that’s actually down from 2019’s recent peak of $3,390. So, although tough financial times could be ahead, hopefully Americans will be able to weather any potential storm and keep their credit card debt in check.