Which State Has the Most Credit Card Debt in 2018?

Consumers in four states each currently owe more than $50 billion to creditors.

Credit card debt has reached new heights in 2018. We surpassed the $1 trillion mark at the end of last year’s holiday shopping season. But almost halfway through this year Americas are showing no signs of slowing down. According to The Balance, average credit card debt is up to $8,151 and 126 million households are in the hole. As a result, CNBC reports that consumer debt is set to break the $4 trillion by the end of 2018.

Now, a new report from the New York state comptroller’s office reveals which state has the most credit card debt.

Which state has the most credit card debt? And how much?


And the amount Californians owe is significantly higher than any other state. Consumers in California racked up more than $106.8 billion in credit card debt. That’s $39.5 billion more than the state that came in second, which was Texas at $67.3. The top four is rounded out with Florida at $59.2 billion and New York and $58.1 billion.

Of course it’s worth noting that those four states are also the most populated. So, these statistics don’t mean that Californians are playing fast and loose with their credit. There just happen to be more credit users there to generate more debt.

Top 10 states with the most credit card debt compared by populations

The list of the Top 10 most credit-indebted states largely matches the most populous states… with a few notable exceptions at the end of the list

State Total Credit Card Debt Population % of Total U.S. Population
1. California $106.8 billion 39.8 million 12.3%
2. Texas $67.3 billion 28.7 million 8.8%
3. Florida $59.2 billion 21.3 million 6.5%
4. New York $58.1 billion 19.9 million 6.1%
5. Pennsylvania $33.2 billion 12.8 million 3.9%
6. Illinois $32.2 billion 12.8 million 3.9%
7. New Jersey $29.6 billion 9 million 2.8%
8. Ohio $26.7 billion 11.7 million 3.6%
9. Virginia $26.5 billion 8.5 million 2.6%
10. Georgia $26.3 billion 10.5 million 3.2%

If you notice, New Jersey and Virginia actually have slightly higher total debt than their population accounts for. New Jersey is ranked 7th for debt, but 11th for population; Virginia is 9th in debt but 12th in population. The 9th and 10th most populous states did not make the list for having the most credit card debt; that’s North Carolina at 10.4 million (3.2% of the U.S. population) and Michigan at 10 million (3% of the U.S. population).

Why are Americans so credit-reliant?

“I think it’s a combination of things that have led us to have so much consumer debt in the U.S.,” says April Lewis-Parks, Financial Education Director for Consolidated Credit. “American families face stagnating wages and higher prices. But I also think a lot of people are simply getting too comfortable carrying credit card debt. As long as you can pay your bills, you think everything is fine. But, in reality, that debt is draining money that you could use for other things.”

Lewis-Parks also believes our social media culture is contributing to a greater need to keep up with Joneses.

Couple relaxes at a spa getting a massage“People see friends and family living their best life on social media,” Lewis-Parks explains. “They want their own feeds to be just as fabulous, so they overspend on credit to keep up. Through social media, I think we’re all prodding each other to spend more. In addition, since the economy is doing better, I think people feel more comfortable carrying excess debt. But it’s a false sense of comfort.”

The problem? One turn in the economy or even just a personal emergency or unexpected expense can send the financial house of cards tumbling.

“One of the challenges with credit card debt is that you often feel like you’re fine until you’re not,” Lewis-Parks continues. “There’s a thin line between just getting by and falling behind and you can cross it quickly.”

What you need to know about carrying credit card debt

#1: It’s not helping your credit

A common myth with credit is that you need to carry credit card balances in order to maintain a high credit score. This is completely false. You can pay off your balances in-full every month and you won’t hurt your credit score. This type of strategy actually helps you achieve the highest credit score possible.

#2: In fact, at a certain point it hurts your credit

Credit utilization is the second biggest factor used to calculate credit scores. Lower is always better. That’s why paying off your balances in-full is best, because you can’t get a better utilization than 0%.

On the other hand, starting to carry balances over month to month will hurt your credit score at a certain point. If you use more than 30% of your available credit line, it decreases your credit score. So, if you have a total available credit limit of $10,000, then you will damage your credit score if you owe more than $3,000.

#3: Carrying balances costs more than you think

Credit card interest charges are not your friend. If you make minimum payments, interest charges eat up anywhere from one half to two thirds of every payment you make. And that’s only if you have rates that are under 20% APR. What’s more, letting balances linger means you could wind up paying more in interest than you paid for the actual original purchase

Which state has the most credit card debt and carries the biggest burden?Let’s say you have that $3,000 balance to pay off from the example above. Your credit card has average APR, which is currently around 16%. If you stick to minimum payments:

  • It takes 195 months to pay off the debt
  • During that time, you pay $3005.92 to get out of debt
  • So, the total cost is $6005.92

It takes you 16 years to get out of debt and you end up paying more interest charges than what you originally charged!

“This is why you always want to try and pay more than the minimum requirement,” Lewis-Parks explains. “Otherwise, you basically throw money away on added interest charges. But even with larger payments, it can take years to pay off your debt if you already have high balances.”

#4: If you use credit correctly, you could avoid interest charges entirely

“if you start and end every billing cycle with no balance – i.e. you pay them off in-full every month – then you use credit interest-free,” Lewis-Parks continues. “Interest charges only apply if you carry balances over. So, it’s in your best interest to carry zero credit card debt. You get all the benefits of credit cards without all the added debt weighing you down. It’s good for your credit and your budget.”

Of course, implementing this strategy means you need to get to zero first. If you already have high balances to pay off, that can be tough to do with traditional payment methods.

“You need to find relief options that reduce or eliminate interest charges so you can pay off your debt faster,” Lewis-Parks concludes. “If you have good credit and owe less than $5,000 then you should be able to consolidate on your own. Otherwise, you may need help, like consumer credit counseling.”

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