Americans have racked up a truly staggering amount of credit card debt. In 2024 alone, the collective debt is expected to increase by $120 billion, and the grand total currently stands at $1.3 trillion.
As Americans are expected to increase their collective debt, personal finance website WalletHub released its report on the states where it will take the longest to pay off credit card debt, with Alaska standing out as the hardest hit state.
To determine the time and cost it would take to pay off the median credit card balance in each of the 50 states and the District of Columbia, the site used data from TransUnion, the Federal Reserve, and the U.S. Census Bureau and then utilized WalletHub’s proprietary credit card payoff calculator system.
“Looking at the average credit card debt in a state can give you a good idea of whether people are struggling or doing well compared to people in other states,” said WalletHub Analyst Cassandra Happe.
“However, it’s also important to look at how much money residents are putting toward their debts each month. Low average payments lead to long payment terms, which in turn leads to large amounts of accrued interest. For example, Vermont’s average credit card debt is relatively low, but it ranks as the state with the third-largest debt problem due to low average monthly payments,” Happe added.
Not all Americans are in the same boat when it comes to credit card debt.
State: (1) Alaska
Average credit card debt: $3,859
Payment cost: -$636
Months and days until payment: 17 months and 11 days
State: (2) District of Columbia
Average credit card debt: $3,613
Payment cost: -$576
Months and days until payment: 16 months and 23 days
State: (3) Vermont
Average credit card debt: $2,770
Payment cost: -$380
Months and days until payment: 14 months and 12 days
State: (4) Colorado
Average credit card debt: $3,305
Payment cost: -$453
Months and days until payment: 14 months and 11 days
State: (5) New Mexico
Average credit card debt: $2,704
Payment cost: -$356
Months and days until payment: 13 months and 24 days
On the other hand:
State: (47) Utah
Average credit card debt: $2,759
Payment cost: -$300
Months and days until payment: 11 months and 10 days
State: (48) South Dakota
Average credit card debt: $2,508
Payment cost: -$272
Months and days until payment: 11 months and 8 days
State: (49) Nebraska
Average credit card debt: $2,502
Payment cost: -$269
Months and days until payment: 11 months and 6 days
State: (50) Pennsylvania
Average credit card debt: $2,553
Payment cost: -$274
Months and days until payment: 11 months and 5 days
State: (51) West Virginia
Average credit card debt: $2,261
Payment cost: -$241
Months and days until payment: 11 months and 3 days
See the complete list and its methodology by clicking here.
The Alaska case
Alaska is the state with the most credit card debt, with the median amount per person at $3,859. Residents’ debt is spread across an average of 2.81 credit cards per person.
Since the average person in Alaska pays $259 per month on their credit card bill, it would take them over 17 months to pay off their entire debt and they would pay $635 in interest.
Keep reading:
· US states with the most people in financial difficulties
· US workers going into debt to buy food
· US cities with the lowest and highest credit card debts in 2024