Report Reveals States with Highest and Lowest Credit Card Debt Burdens

A recent report by CreditCards.com has shed light on the states in the United States where consumers face the highest and lowest credit card debt burdens. The analysis takes into account average credit card balances, average annual household incomes, the time required to pay off credit card balances, and the total interest paid by households in each state.

According to the report, Mississippi takes the unfortunate distinction of being the state where consumers carry the highest average credit card debt burden relative to their income. Despite having the sixth-lowest average credit card balance, Mississippi has the lowest average household income in the country. This combination makes credit card debt significantly harder to pay off in the Magnolia State.

In contrast, Massachusetts ranks as the state with the lowest credit card debt burden. Residents of Massachusetts have the lowest average credit card balance relative to their income. The state’s higher average household income plays a key role in making credit card debt more manageable for its residents.

The analysis provides further insights into the states with the heaviest credit card debt burdens relative to income. Following Mississippi, Oklahoma ranks second on the list, with Louisiana, New Mexico, and Nevada rounding out the top five. These states exhibit higher credit card balances coupled with average household incomes that contribute to a longer payoff period.

Conversely, Massachusetts tops the list of states with the lowest credit card burdens relative to income. The report finds that the residents of Massachusetts have a shorter payoff period due to a combination of lower average credit card balances and higher average household incomes. Washington, D.C., also performs well in this regard, ranking second when included alongside the 50 states.

Among the states with the lowest credit card burdens relative to income, Minnesota takes third place, followed by New Hampshire and California. These states benefit from a shorter payoff period due to the combination of lower credit card balances and higher household incomes.

The report by CreditCards.com offers valuable insights into the credit card debt burdens faced by consumers across different states. It highlights the challenges faced by residents in states with lower incomes and higher credit card balances and emphasizes the importance of managing debt effectively.

As individuals strive to improve their financial well-being, understanding the dynamics of credit card debt burdens can help guide their financial decisions and foster responsible financial practices.