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In America, we love our credit cards. In fact, in the second quarter of 2018 Americans collectively owed $782 billion on their cards, according to data from Experian. This is a 6.6% increase in indebtedness compared with how much Americans collectively owed in 2017.
While Americans as a whole owe a lot of money on credit cards, debt isn't distributed evenly by state. In fact, in the state with the highest average credit card debt, the average balance is more than $3,000 higher than the state where balances are the lowest.
How does your state compare? Let's find out!
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These nine state have the highest credit card debt
Here are the nine states -- plus Washington, D.C. -- with the most credit card debt in 2017, according to Experian. They're in order from most to least indebted.
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Alaska, with an average balance of $8,515
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Connecticut, with an average balance of $7,258
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Virginia, with an average balance of $7,161
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New Jersey, with an average balance of $7,151
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Maryland, with an average balance of $7,043
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Hawaii, with an average balance of $6,981
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District of Columbia, with an average balance of $6,963
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Texas, with an average balance of $6,902
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Colorado, with an average balance of $6,718
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Georgia, with an average balance of $6,675
In each of these states, average credit card balances are way above locales with the lowest balances in the country. By comparison, for example, Iowans owe the least with an average balance of just $5,155. Balances are also well above the national average balance for all Americans, which was $6,354 in 2017.
Unfortunately, in many states, these high balances are just one troubling indicator. Several of the states on the list, including Texas and Georgia, are also on the list of the 10 states where residents have the lowest Vantage Scores in the country. Texas also has the highest average late-payment rate in the country.
High credit card balances are bad news
Whether your state ranks at the top of the list of most indebted locales or at the bottom, the fact more people in America are going into debt across the nation is bad news.
When people are in debt, more money goes to paying interest instead of saving for the future or buying new things. If people can't save for future goals such as buying a house, paying for college, or retirement, this can cause a financial crisis down the road if real estate prices fall, a new generation is saddled with student loans, and tons of retirees struggle to survive. And, if people don't have the money to shop, it can spur a recession.