In this piece, we will take a look at the 25 states with the highest credit card debt in the US.

The American economy is fueled by consumer spending due to being the largest in the world. Private enterprise and capitalist ideals permeate the U.S. way of life, and when compared to several other countries, the pursuit of wealth is often not looked down upon by people. Naturally, this means that consumer well being is quite essential for broader U.S. economic well being, and each year companies and politicians pour over countless initiatives and programs to ensure that American consumers can spend as much as they want.

However, the size of the U.S. economy, which is the biggest in the world, coupled with a high living standard means that most people might find it difficult to fund pricey purchases through their monthly income. This is where the credit card comes in, being a handy medium that allows people to buy now and pay later – with an interest surcharge. Credit cards also provide consumers protection from fraud, and they are often highly sought after since they allow borrowers to develop a credit profile to convince banks to lend them money for pricey purchases such as houses and cars.

These safety and convenience benefits offered by credit cards mean that there are more cards than people in the world. In fact, Insider Monkey took a look at 20 Countries with Most Credit Card Debt in the World and found that as of 2020, there were a whopping 6.8 billion credit cards in the world. This is despite the fact that most of the developing and underdeveloped world, such as countries in Africa and Asia, are still relatively unbanked when compared to their Western peers.

The close link between consumer spending in developed nations like the U.S., Canada, and Germany also means that their governments are able to exercise greater economic control to help manage macroeconomic metrics such as inflation and GDP growth. In fact, if you have followed the financial press even briefly over the past couple of years, then you’ll know that the most popular topic among analysts and members of the press is the interest rate. The Federal Reserve has raised interest rates to levels last seen before the Great Recession of 2008, and this allows it to control consumer spending as credit becomes more expensive.

These high rates have already made their way to consumers as well. To understand the severity of this on consumer and credit card users, let’s take a look at data from the St. Louis Federal Reserve. The institution shares that the commercial bank interest rate on credit card plans for all accounts currently sits at an eye watering 21.59%. This is the highest level since the data was first compiled in 1994, underscoring the significant stress that consumers are facing right now even as analysts and politicians cheer robust U.S. economic growth throughout 2023 and the first quarter of 2024.

Higher interest rates, as some of you might be aware, mean that while the borrowers might struggle with high credit costs, the lenders are quite happy to dole out as much money as they can. But before we get to what the credit card issuers are seeing in the market at a time when the U.S. economy continues to grow despite high interest rates, the American industry is also seeing other historic developments.

These come in the form of one of the biggest credit card issuers in America, Capital One Financial Corporation (NYSE:COF), seeking to buy out the digital bank Discover Financial Services (NYSE:DFS) for a $35.3 billion deal. Should the deal secure regulatory approval, then it will see Capital One become one of the biggest banks in the U.S., and it will also allow Discover to expand its scope and compete with two of the biggest credit card companies in the world, namely Mastercard Incorporated (NYSE:MA) and Visa Inc. (NYSE:V).

So, how are credit card companies faring in this era of record high interest rates? Well, here’s what the management of American Express Company (NYSE:AXP) had to say during its fourth quarter of 2024 earnings call:

Since 2021, we’ve delivered record annual revenues, increasing the scale of our business by over 40% in just two years from $42 billion to $61 billion in annual revenues — in revenues. Annual card spending over this period has increased 37% on an FX adjusted basis to a record $1.5 trillion. We’ve added about 25 million new proprietary card accounts over the last two years, and over 70% of these new accounts are coming into the franchise on fee-based products. With the growth and new accounts we’ve seen over the past few years, we now have a total of over 140 million cards running on our global network. Our focus on continuously innovating our value propositions to meet the needs of our customers is driving increased brand relevance across generations, including millennial and Gen Z consumers.

So, which states in the U.S. have the highest credit card debt in today’s era of high interest rates? Take a look below to find out.

Our Methodology

For our list of the U.S. states with the highest credit card debt, we used data from the Federal Reserve Bank of New York’s Center of Microeconomic Data’s State Level Household Debt Statistics 2003-2023 for Q4 2023 and picked out the 25 states that had the highest credit card debt balance per capita.

25 States With the Highest Credit Card Debt in the US

25. Pennsylvania

Credit Card Debt Balance per Capita: $3,720

Pennsylvania holds a central place in American history and politics. Its $974 billion GDP makes it not only one of the most prosperous states in America but also allows Pennsylvania to beat numerous countries with its economic output.

24. North Carolina

Credit Card Debt Balance per Capita: $3,720

North Carolina is a Southeastern U.S. state that is one of the top ten most populated states in America. It is one of the earliest states to join the Union, and the state also benefits from a strong industrial and agricultural base.

23. Minnesota

Credit Card Debt Balance per Capita: $3,740

Minnesota is located at the US border with Canada and it is a state that is known all over the U.S. for its forests and rivers. The region is known for its agricultural and mining economies.

22. Utah

Credit Card Debt Balance per Capita: $3,850

Utah is a Western American state that was one of the last to join the Union. While it is also one of the more sparsely populated areas in the U.S., the state ranks high in median household income.

21. Illinois

Credit Card Debt Balance per Capita: $3,910

Illinois is a Midwestern state that ranks high among the list of the ten most populated U.S. states. It has some of the highest rates of oil refining in America and strong agricultural and manufacturing sectors to boot.

20. Arizona

Credit Card Debt Balance per Capita: $4,040

Arizona is a Southwestern U.S. state that is the sixth largest in area. These days it is at the center of national attention due to multi billion dollar chip plants being set up by local and foreign companies after help from the U.S. government.

19. Rhode Island

Credit Card Debt Balance per Capita: $4,070

Rhode Island is one of the smallest U.S. states in terms of area. However, it is the second most densely populated American state.

18. Delaware

Credit Card Debt Balance per Capita: $4,120

Delaware is another small American state that ranks just above Rhode Island for its area. It has a sizeable presence of companies from all industries, ranging from banking to poultry.

17. New Hampshire

Credit Card Debt Balance per Capita: $4,140

New Hampshire is among the states that have the highest median income in America. However, its area also limits its economic output and places it low among other states.

16. Georgia

Credit Card Debt Balance per Capita: $4,180

Georgia is a Southeastern US state that was one of the first to accede to the Union. It is also one of the most populated and boasts a vibrant corporate sector made of  big ticket names such as Coca Cola.

15. Texas

Credit Card Debt Balance per Capita: $4,200

Texas is the second largest state in America in terms of area. Energy and aerospace are among the biggest sectors in its economy, due to the presence of players like SpaceX.

14. Washington

Credit Card Debt Balance per Capita: $4,240

Washington is one of the most prosperous states in America which is among those with the highest incomes in America. Boeing, Amazon, Microsoft, and others are among some of the biggest firms in the region.

13. Massachusetts

Credit Card Debt Balance per Capita: $4,300

Massachusetts is one of the most populous and prosperous states in America. It is known for its vibrant healthcare and education industries.

12. Virginia

Credit Card Debt Balance per Capita: $4,390

Virginia, a Southeastern US state, is best known for the Pentagon and the associated firms that are part of the defense and government consulting/contracting industries.

11. California

Credit Card Debt Balance per Capita: $4,450

California is one of the most economically well off states in America due to the presence of the technology industry. This also lends the state some of the highest price levels in the U.S. and has also seen the exodus of high earners from regions such as San Francisco.

10. New York

Credit Card Debt Balance per Capita: $4,470

New York is another prosperous American state. Known primarily for its financial hub New York City, the state plays a crucial role in global financial and media industries. New York State also has one of the largest economies not only in the U.S. but also in the world.

9. Colorado

Credit Card Debt Balance per Capita: $4,480

Colorado is one of the biggest American states in terms of area. It also has one of the highest median household incomes in the country. The state is known for the strong presence of the U.S. government, with crucial facilities of the Air Force and other government bodies present in the region.

8. Nevada

Credit Card Debt Balance per Capita: $4,490

Nevada is another sizeable American state. Located in the Western half of the United States, it is best known as the gambling hub of Las Vegas. Apart from betting and hospitality, other crucial Nevadan economic sectors include agriculture and mining. The state’s large area also means that it is quite sparsely populated.

7. Florida

Credit Card Debt Balance per Capita: $4,540

Florida, called the Sunshine State, is located in the Southeastern region of the U.S. It shares a coast with the Atlantic Ocean, and a relatively lower latitude allows Florida to feature America’s human spaceport in the form of NASA’s Kennedy Space Center. Florida is also one of the most populous states in America.

6. Connecticut

Credit Card Debt Balance per Capita: $e E4,540

Connecticut is one of the smallest American states in terms of area. It was one of the earliest states to join the Union and ranks high for both population density and median household income. Manufacturing and health services are key sectors of the Connecticut economy.

5. Maryland

Credit Card Debt Balance per Capita: $4,720

Maryland is another small state whose area makes it one of the most densely populated areas in the country. It was in the news earlier this year after the collapse of the Baltimore Bridge that stoked fears of supply chain disruptions.

4. New Jersey

Credit Card Debt Balance per Capita: $4,750

New Jersey is the most densely populated state in the U.S. and one of the smallest in terms of areas as well. Its location on the East Coast makes it a shipping hub, and New Jersey is also known for its healthcare industry.

3. Hawaii

Credit Card Debt Balance per Capita: $4,770

Hawaii is one of America’s island states and is known for having some of the highest prices in the country. A year after deadly fires in Maui wreaked havoc, authorities are now investigating whether a communications breakdown exacerbated the damage.

2. Alaska

Credit Card Debt Balance per Capita: $4,980

Alaska is perhaps the remotest US state since it is separated from the Continental United States by Canada. It is also the only American state that borders Russia, and the region is known for its vast natural resources.

1. Washington, D.C.

Credit Card Debt Balance per Capita: $5,190

Washington D.C., while not a state, still merits a mention since its residents have the highest credit card debt in the U.S. This is perhaps unsurprising, as like Hawaii, New York, and California, it also has some of the highest prices in the country.

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Disclosure. None. 25 States With the Highest Credit Card Debt in the US was initially published on Insider Monkey.