Best way to pay off credit card debt? Move to Indiana
- Altogether, Americans owe more than $1 trillion in credit card debt.
- Residents in some states are faring better than others when it comes to paying down their balances, according to a new report.
- Here is the nationwide rundown.
Collectively, Americans owe more than $1 trillion in credit card debt.
Despite the strong preference for plastic, that burden is not felt across the board. Residents in some states are faring better than others when it comes to paying down their balances, according to a new report by WalletHub.
Using the median credit card balance and monthly credit card payment of residents in each state based on credit data from TransUnion and the Bureau of Labor Statistics, the personal finance site determined the required number of months to pay off that balance and the finance charges that would result, assuming an average 16.91% annual percentage rate.
From there, WalletHub ranked the states from least sustainable credit card debt — or longest payoff timeline — to shortest.
In Indiana, for example, where the average balance is only $2,313, it would take a little less than 10 months to pay that back while racking up $167 in interest charges.
In Alaska, however, the average balance is $4,144 — nearly twice as much — and that would take 19 months, or more than a year and a half, to pay off, while ringing up $575 in finance charges.
Here is the nationwide rundown:
States with the Highest & Lowest Credit-Card Debts
| Rank* | State | Median Credit-Card Debt | Cost to Pay off | Months & Days Until Payoff |
|---|---|---|---|---|
| 1 | Alaska | $4,144 | $575 | 19 months and 11 days |
| 2 | District of Columbia | $3,242 | $404 | 17 months and 12 days |
| 3 | Vermont | $2,227 | $247 | 15 months and 14 days |
| 4 | Washington | $2,880 | $313 | 15 months and 3 days |
| 5 | Colorado | $2,985 | $324 | 15 months and 3 days |
| 6 | Oregon | $2,641 | $282 | 14 months and 29 days |
| 7 | Wyoming | $2,712 | $290 | 14 months and 29 days |
| 8 | Virginia | $3,081 | $327 | 14 months and 26 days |
| 9 | Montana | $2,579 | $269 | 14 months and 17 days |
| 10 | New Mexico | $2,613 | $268 | 14 months and 7 days |
| 11 | Kansas | $2,574 | $264 | 14 months and 7 days |
| 12 | Texas | $2,860 | $292 | 14 months and 4 days |
| 13 | Idaho | $2,426 | $247 | 14 months and 4 days |
| 14 | North Dakota | $2,385 | $236 | 13 months and 24 days |
| 15 | Georgia | $2,786 | $274 | 13 months and 22 days |
| 16 | Utah | $2,508 | $246 | 13 months and 20 days |
| 17 | Massachusetts | $2,459 | $241 | 13 months and 19 days |
| 18 | California | $2,672 | $261 | 13 months and 18 days |
| 19 | Arizona | $2,686 | $262 | 13 months and 17 days |
| 20 | Minnesota | $2,510 | $245 | 13 months and 17 days |
| 21 | Oklahoma | $2,628 | $255 | 13 months and 15 days |
| 22 | North Carolina | $2,593 | $251 | 13 months and 14 days |
| 23 | New Hampshire | $2,511 | $242 | 13 months and 11 days |
| 24 | Nevada | $2,645 | $254 | 13 months and 9 days |
| 25 | Maryland | $2,819 | $270 | 13 months and 8 days |
| 26 | Tennessee | $2,544 | $243 | 13 months and 8 days |
| 27 | Michigan | $2,343 | $224 | 13 months and 7 days |
| 28 | South Carolina | $2,579 | $245 | 13 months and 4 days |
| 29 | Maine | $2,265 | $214 | 13 months and 2 days |
| 30 | Connecticut | $2,755 | $260 | 13 months |
| 31 | Wisconsin | $2,120 | $197 | 12 months and 29 days |
| 32 | Missouri | $2,460 | $228 | 12 months and 29 days |
| 33 | Florida | $2,603 | $239 | 12 months and 22 days |
| 34 | New York | $2,600 | $238 | 12 months and 22 days |
| 35 | Louisiana | $2,600 | $237 | 12 months and 19 days |
| 36 | New Jersey | $2,701 | $246 | 12 months and 19 days |
| 37 | Illinois | $2,665 | $241 | 12 months and 17 days |
| 38 | Rhode Island | $2,392 | $216 | 12 months and 15 days |
| 39 | Iowa | $2,091 | $188 | 12 months and 14 days |
| 40 | West Virginia | $2,331 | $210 | 12 months and 14 days |
| 41 | Nebraska | $2,302 | $207 | 12 months and 13 days |
| 42 | Ohio | $2,325 | $207 | 12 months and 9 days |
| 43 | Arkansas | $2,353 | $202 | 11 months and 29 days |
| 44 | Hawaii | $2,868 | $246 | 11 months and 28 days |
| 45 | South Dakota | $2,449 | $209 | 11 months and 25 days |
| 46 | Delaware | $2,515 | $213 | 11 months and 23 days |
| 47 | Pennsylvania | $2,344 | $198 | 11 months and 21 days |
| 48 | Alabama | $2,451 | $206 | 11 months and 19 days |
| 49 | Kentucky | $2,248 | $187 | 11 months and 14 days |
| 50 | Mississippi | $2,258 | $170 | 10 months and 9 days |
| 51 | Indiana | $2,313 | $167 | 9 months and 29 days |
"This level of credit card debt is not sustainable," said Jill Gonzalez, an analyst at WalletHub.
Better credit card management boils down to making payments on time and not buying things you otherwise can't afford. Gonzalez also recommends making at least the minimum payment every month to avoid fees and putting extra resources toward paying down the highest-interest card first.
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