Special Report

States Where People Are Struggling With the Most Debt

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Many of us have experienced the desperation that comes from crushing debt at one point in our lives. Whether it’s student loans, car payments, credit card balances, or all of the above, debt is one of the main reasons why many Americans spend years delaying important life decisions — like acquiring home equity, establishing a retirement savings account, or even going to the doctor. 

The “Report on the Economic Well-Being of U.S. Households in 2019” issued by the Board of Governors of the Federal Reserve System in May of last year, revealed that 28% of households couldn’t pay a month of bills in full, or wouldn’t be able to pay the bills in full if they confronted an unexpected $400 expense. Their fallback? Credit cards, payday or auto-title lenders, or support from family and friends. These are the cities hit hardest by extreme poverty in every state.

The report also noted that about a fourth of adults delayed visits to the doctor or dentist because they were unable to afford the cost. And this, remember, was before the economic devastation caused by the pandemic had taken full effect.

Like many aspects of American life, the detrimental impact of debt has a racial bias. Poverty disproportionately affects communities of color, and debt piles up disproportionately in non-white households. Communities of color have a higher amount of debt in default than white-majority communities (39% versus 24%) as well as more unsecured-loan defaults involving medical, student loan, auto/retail, and credit cards balances. (The Urban Institute defines people of color as “those who are African American, Hispanic, Asian or Pacific Islander, American Indian or Alaska Native, another race other than white, or multiracial.”)

Click here to see the states where people are struggling with the most debt.

To identify the states where people are struggling the most in debt, 24/7 Wall St. reviewed every state’s median debt in collections among those residents with any debt in collections from non-profit think tank Urban Institute‘s Debt in America 2021 report. The Urban Institute used credit bureau data from 2020. 

The median debt in collections and the share of adults with debt in collections for communities of color and for white communities also came from the Urban Institute. The majority-white communities are based on credit records for people who live in zip codes where most residents are white (at least 60% of the population is white), and communities of color values are based on credit records for people who live in zip codes where most residents are people of color (at least 60 percent of the population is African American, Hispanic, Asian or Pacific Islander, American Indian or Alaska Native, another race other than white, or multiracial). 

Like wealth, debt is distributed unevenly across the U.S. Americans in some parts of the country struggle more than in others. Based on statistics compiled by the Urban Institute, 24/7 Wall St. has ranked the states according to the median amount of debt in collections in each one. Some of the positions might surprise you. These are 16 states where poverty is worse than you might think.

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50. Kentucky
> Median debt in collections $1,296
> Adults with any debt in collections: 34.8% — 11th highest
> Median debt in collections, communities of color: $1,037 — 10th lowest
> Adults with any debt in collections, communities of color: 68.1% — 2nd highest
> Median debt in collections, majority white communities: $1,305 — 2nd lowest
> Share with any debt in collections, majority white communities: 33.3% — 6th highest

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49. New Jersey
> Median debt in collections $1,352
> Adults with any debt in collections: 24.4% — 20th lowest
> Median debt in collections, communities of color: $1,286 — 12th lowest
> Adults with any debt in collections, communities of color: 36.7% — 14th lowest
> Median debt in collections, majority white communities: $1,430 — 4th lowest
> Share with any debt in collections, majority white communities: 17.9% — 9th lowest

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48. Illinois
> Median debt in collections $1,489
> Adults with any debt in collections: 27.4% — 22nd highest
> Median debt in collections, communities of color: $1,463 — 18th lowest
> Adults with any debt in collections, communities of color: 44.1% — 25th lowest
> Median debt in collections, majority white communities: $1,521 — 7th lowest
> Share with any debt in collections, majority white communities: 22.2% — 23rd lowest

47. Ohio
> Median debt in collections $1,501
> Adults with any debt in collections: 31.5% — 17th highest
> Median debt in collections, communities of color: $1,459 — 17th lowest
> Adults with any debt in collections, communities of color: 56.4% — 5th highest
> Median debt in collections, majority white communities: $1,507 — 5th lowest
> Share with any debt in collections, majority white communities: 28.0% — 15th highest

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46. Michigan
> Median debt in collections $1,505
> Adults with any debt in collections: 28.1% — 21st highest
> Median debt in collections, communities of color: $1,812 — 21st highest
> Adults with any debt in collections, communities of color: 56.4% — 6th highest
> Median debt in collections, majority white communities: $1,412 — 3rd lowest
> Share with any debt in collections, majority white communities: 24.1% — 21st highest

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45. Connecticut
> Median debt in collections $1,516
> Adults with any debt in collections: 24.5% — 21st lowest
> Median debt in collections, communities of color: $1,439 — 15th lowest
> Adults with any debt in collections, communities of color: 43.1% — 23rd lowest
> Median debt in collections, majority white communities: $1,540 — 9th lowest
> Share with any debt in collections, majority white communities: 18.1% — 12th lowest

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44. Oregon
> Median debt in collections $1,532
> Adults with any debt in collections: 18.7% — 7th lowest
> Median debt in collections, communities of color: N/A — N/A
> Adults with any debt in collections, communities of color: N/A — N/A
> Median debt in collections, majority white communities: $1,551 — 10th lowest
> Share with any debt in collections, majority white communities: 18.0% — 10th lowest

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43. Massachusetts
> Median debt in collections $1,564
> Adults with any debt in collections: 18.8% — 8th lowest
> Median debt in collections, communities of color: $1,455 — 16th lowest
> Adults with any debt in collections, communities of color: 34.7% — 12th lowest
> Median debt in collections, majority white communities: $1,630 — 12th lowest
> Share with any debt in collections, majority white communities: 15.8% — 3rd lowest

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42. West Virginia
> Median debt in collections $1,583
> Adults with any debt in collections: 40.0% — 4th highest
> Median debt in collections, communities of color: N/A — N/A
> Adults with any debt in collections, communities of color: N/A — N/A
> Median debt in collections, majority white communities: $1,572 — 11th lowest
> Share with any debt in collections, majority white communities: 40.0% — the highest

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41. North Carolina
> Median debt in collections $1,593
> Adults with any debt in collections: 34.3% — 14th highest
> Median debt in collections, communities of color: $1,676 — 22nd lowest
> Adults with any debt in collections, communities of color: 46.1% — 23rd highest
> Median debt in collections, majority white communities: $1,533 — 8th lowest
> Share with any debt in collections, majority white communities: 29.7% — 12th highest

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40. Maryland
> Median debt in collections $1,608
> Adults with any debt in collections: 27.0% — 25th highest
> Median debt in collections, communities of color: $1,708 — 24th lowest
> Adults with any debt in collections, communities of color: 36.0% — 13th lowest
> Median debt in collections, majority white communities: $1,512 — 6th lowest
> Share with any debt in collections, majority white communities: 21.0% — 20th lowest

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39. Iowa
> Median debt in collections $1,632
> Adults with any debt in collections: 21.8% — 14th lowest
> Median debt in collections, communities of color: $899 — 8th lowest
> Adults with any debt in collections, communities of color: 48.4% — 19th highest
> Median debt in collections, majority white communities: $1,669 — 16th lowest
> Share with any debt in collections, majority white communities: 21.1% — 21st lowest

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38. Colorado
> Median debt in collections $1,645
> Adults with any debt in collections: 23.2% — 18th lowest
> Median debt in collections, communities of color: $1,396 — 13th lowest
> Adults with any debt in collections, communities of color: 38.7% — 16th lowest
> Median debt in collections, majority white communities: $1,689 — 20th lowest
> Share with any debt in collections, majority white communities: 19.4% — 15th lowest

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37. Arkansas
> Median debt in collections $1,656
> Adults with any debt in collections: 37.3% — 6th highest
> Median debt in collections, communities of color: $1,870 — 17th highest
> Adults with any debt in collections, communities of color: 56.4% — 7th highest
> Median debt in collections, majority white communities: $1,634 — 13th lowest
> Share with any debt in collections, majority white communities: 34.5% — 4th highest

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36. Maine
> Median debt in collections $1,671
> Adults with any debt in collections: 27.2% — 24th highest
> Median debt in collections, communities of color: N/A — N/A
> Adults with any debt in collections, communities of color: N/A — N/A
> Median debt in collections, majority white communities: $1,673 — 17th lowest
> Share with any debt in collections, majority white communities: 27.1% — 17th highest

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35. Vermont
> Median debt in collections $1,674
> Adults with any debt in collections: 17.8% — 5th lowest
> Median debt in collections, communities of color: N/A — N/A
> Adults with any debt in collections, communities of color: N/A — N/A
> Median debt in collections, majority white communities: $1,685 — 19th lowest
> Share with any debt in collections, majority white communities: 17.7% — 8th lowest

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34. New Hampshire
> Median debt in collections $1,680
> Adults with any debt in collections: 19.3% — 10th lowest
> Median debt in collections, communities of color: N/A — N/A
> Adults with any debt in collections, communities of color: N/A — N/A
> Median debt in collections, majority white communities: $1,679 — 18th lowest
> Share with any debt in collections, majority white communities: 19.3% — 14th lowest

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33. Rhode Island
> Median debt in collections $1,681
> Adults with any debt in collections: 24.2% — 19th lowest
> Median debt in collections, communities of color: $1,547 — 20th lowest
> Adults with any debt in collections, communities of color: 38.1% — 15th lowest
> Median debt in collections, majority white communities: $1,732 — 24th lowest
> Share with any debt in collections, majority white communities: 20.9% — 19th lowest

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32. Wisconsin
> Median debt in collections $1,687
> Adults with any debt in collections: 20.9% — 11th lowest
> Median debt in collections, communities of color: $1,465 — 19th lowest
> Adults with any debt in collections, communities of color: 53.2% — 12th highest
> Median debt in collections, majority white communities: $1,743 — 25th highest
> Share with any debt in collections, majority white communities: 18.1% — 11th lowest

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31. Kansas
> Median debt in collections $1,706
> Adults with any debt in collections: 27.4% — 23rd highest
> Median debt in collections, communities of color: $1,421 — 14th lowest
> Adults with any debt in collections, communities of color: 47.0% — 21st highest
> Median debt in collections, majority white communities: $1,740 — 25th lowest
> Share with any debt in collections, majority white communities: 24.1% — 22nd highest

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30. Minnesota
> Median debt in collections $1,719
> Adults with any debt in collections: 14.2% — the lowest
> Median debt in collections, communities of color: $1,868 — 18th highest
> Adults with any debt in collections, communities of color: 32.6% — 11th lowest
> Median debt in collections, majority white communities: $1,699 — 22nd lowest
> Share with any debt in collections, majority white communities: 13.0% — the lowest

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29. New Mexico
> Median debt in collections $1,722
> Adults with any debt in collections: 34.4% — 13th highest
> Median debt in collections, communities of color: $1,658 — 21st lowest
> Adults with any debt in collections, communities of color: 40.1% — 20th lowest
> Median debt in collections, majority white communities: $1,776 — 24th highest
> Share with any debt in collections, majority white communities: 22.4% — 25th lowest

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28. New York
> Median debt in collections $1,734
> Adults with any debt in collections: 22.0% — 16th lowest
> Median debt in collections, communities of color: $1,725 — 25th lowest
> Adults with any debt in collections, communities of color: 29.3% — 9th lowest
> Median debt in collections, majority white communities: $1,789 — 23rd highest
> Share with any debt in collections, majority white communities: 18.1% — 13th lowest

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27. Montana
> Median debt in collections $1,757
> Adults with any debt in collections: 21.9% — 15th lowest
> Median debt in collections, communities of color: $1,884 — 16th highest
> Adults with any debt in collections, communities of color: 52.3% — 13th highest
> Median debt in collections, majority white communities: $1,732 — 24th lowest
> Share with any debt in collections, majority white communities: 20.8% — 17th lowest

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26. Virginia
> Median debt in collections $1,785
> Adults with any debt in collections: 26.9% — 25th lowest
> Median debt in collections, communities of color: $1,930 — 13th highest
> Adults with any debt in collections, communities of color: 39.5% — 18th lowest
> Median debt in collections, majority white communities: $1,666 — 15th lowest
> Share with any debt in collections, majority white communities: 23.7% — 23rd highest

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25. North Dakota
> Median debt in collections $1,786
> Adults with any debt in collections: 16.8% — 3rd lowest
> Median debt in collections, communities of color: $993 — 9th lowest
> Adults with any debt in collections, communities of color: 41.7% — 22nd lowest
> Median debt in collections, majority white communities: $1,870 — 19th highest
> Share with any debt in collections, majority white communities: 16.0% — 4th lowest

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24. Pennsylvania
> Median debt in collections $1,795
> Adults with any debt in collections: 26.0% — 22nd lowest
> Median debt in collections, communities of color: $1,756 — 23rd highest
> Adults with any debt in collections, communities of color: 52.2% — 15th highest
> Median debt in collections, majority white communities: $1,809 — 21st highest
> Share with any debt in collections, majority white communities: 22.4% — 24th lowest

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23. Mississippi
> Median debt in collections $1,803
> Adults with any debt in collections: 38.3% — 5th highest
> Median debt in collections, communities of color: $1,809 — 22nd highest
> Adults with any debt in collections, communities of color: 50.8% — 16th highest
> Median debt in collections, majority white communities: $1,829 — 20th highest
> Share with any debt in collections, majority white communities: 32.4% — 7th highest

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22. Washington
> Median debt in collections $1,846
> Adults with any debt in collections: 17.5% — 4th lowest
> Median debt in collections, communities of color: $1,732 — 24th highest
> Adults with any debt in collections, communities of color: 23.4% — 7th lowest
> Median debt in collections, majority white communities: $1,808 — 22nd highest
> Share with any debt in collections, majority white communities: 16.1% — 5th lowest

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21. Delaware
> Median debt in collections $1,847
> Adults with any debt in collections: 30.9% — 18th highest
> Median debt in collections, communities of color: $1,867 — 19th highest
> Adults with any debt in collections, communities of color: 49.6% — 17th highest
> Median debt in collections, majority white communities: $1,650 — 14th lowest
> Share with any debt in collections, majority white communities: 25.5% — 20th highest

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20. Indiana
> Median debt in collections $1,873
> Adults with any debt in collections: 30.7% — 19th highest
> Median debt in collections, communities of color: $1,862 — 20th highest
> Adults with any debt in collections, communities of color: 52.2% — 14th highest
> Median debt in collections, majority white communities: $1,873 — 18th highest
> Share with any debt in collections, majority white communities: 28.0% — 14th highest

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19. California
> Median debt in collections $1,882
> Adults with any debt in collections: 23.2% — 17th lowest
> Median debt in collections, communities of color: $1,906 — 15th highest
> Adults with any debt in collections, communities of color: 27.5% — 8th lowest
> Median debt in collections, majority white communities: $1,695 — 21st lowest
> Share with any debt in collections, majority white communities: 16.5% — 6th lowest

18. Louisiana
> Median debt in collections $1,910
> Adults with any debt in collections: 40.9% — the highest
> Median debt in collections, communities of color: $1,945 — 12th highest
> Adults with any debt in collections, communities of color: 54.3% — 11th highest
> Median debt in collections, majority white communities: $1,916 — 15th highest
> Share with any debt in collections, majority white communities: 35.2% — 2nd highest

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17. Hawaii
> Median debt in collections $1,927
> Adults with any debt in collections: 18.4% — 6th lowest
> Median debt in collections, communities of color: $1,930 — 13th highest
> Adults with any debt in collections, communities of color: 18.4% — 6th lowest
> Median debt in collections, majority white communities: $00 — N/A
> Share with any debt in collections, majority white communities: 22.5% — 25th highest

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16. Alabama
> Median debt in collections $1,931
> Adults with any debt in collections: 36.9% — 7th highest
> Median debt in collections, communities of color: $1,983 — 9th highest
> Adults with any debt in collections, communities of color: 55.4% — 10th highest
> Median debt in collections, majority white communities: $1,912 — 17th highest
> Share with any debt in collections, majority white communities: 32.2% — 8th highest

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15. Tennessee
> Median debt in collections $1,959
> Adults with any debt in collections: 34.4% — 12th highest
> Median debt in collections, communities of color: $2,250 — 3rd highest
> Adults with any debt in collections, communities of color: 57.3% — 4th highest
> Median debt in collections, majority white communities: $1,920 — 14th highest
> Share with any debt in collections, majority white communities: 31.4% — 10th highest

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14. Georgia
> Median debt in collections $1,968
> Adults with any debt in collections: 36.6% — 9th highest
> Median debt in collections, communities of color: $2,049 — 6th highest
> Adults with any debt in collections, communities of color: 47.0% — 22nd highest
> Median debt in collections, majority white communities: $1,915 — 16th highest
> Share with any debt in collections, majority white communities: 30.6% — 11th highest

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13. Utah
> Median debt in collections $1,992
> Adults with any debt in collections: 21.0% — 12th lowest
> Median debt in collections, communities of color: $1,727 — 25th highest
> Adults with any debt in collections, communities of color: 40.5% — 21st lowest
> Median debt in collections, majority white communities: $2,049 — 11th highest
> Share with any debt in collections, majority white communities: 19.7% — 16th lowest

12. Missouri
> Median debt in collections $2,004
> Adults with any debt in collections: 31.9% — 16th highest
> Median debt in collections, communities of color: $2,295 — 2nd highest
> Adults with any debt in collections, communities of color: 61.5% — 3rd highest
> Median debt in collections, majority white communities: $1,948 — 13th highest
> Share with any debt in collections, majority white communities: 28.4% — 13th highest

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11. Arizona
> Median debt in collections $2,042
> Adults with any debt in collections: 30.3% — 20th highest
> Median debt in collections, communities of color: $1,975 — 10th highest
> Adults with any debt in collections, communities of color: 44.8% — 25th highest
> Median debt in collections, majority white communities: $2,044 — 12th highest
> Share with any debt in collections, majority white communities: 22.9% — 24th highest

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10. Nebraska
> Median debt in collections $2,055
> Adults with any debt in collections: 19.2% — 9th lowest
> Median debt in collections, communities of color: $1,995 — 8th highest
> Adults with any debt in collections, communities of color: 39.5% — 19th lowest
> Median debt in collections, majority white communities: $2,123 — 10th highest
> Share with any debt in collections, majority white communities: 17.0% — 7th lowest

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9. South Carolina
> Median debt in collections $2,119
> Adults with any debt in collections: 40.2% — 3rd highest
> Median debt in collections, communities of color: $2,047 — 7th highest
> Adults with any debt in collections, communities of color: 55.7% — 9th highest
> Median debt in collections, majority white communities: $2,159 — 8th highest
> Share with any debt in collections, majority white communities: 34.6% — 3rd highest

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8. Alaska
> Median debt in collections $2,120
> Adults with any debt in collections: 26.6% — 24th lowest
> Median debt in collections, communities of color: $1,273 — 11th lowest
> Adults with any debt in collections, communities of color: 31.7% — 10th lowest
> Median debt in collections, majority white communities: $2,326 — 2nd highest
> Share with any debt in collections, majority white communities: 21.8% — 22nd lowest

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7. Texas
> Median debt in collections $2,131
> Adults with any debt in collections: 40.7% — 2nd highest
> Median debt in collections, communities of color: $2,104 — 5th highest
> Adults with any debt in collections, communities of color: 49.3% — 18th highest
> Median debt in collections, majority white communities: $2,157 — 9th highest
> Share with any debt in collections, majority white communities: 31.9% — 9th highest

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6. Nevada
> Median debt in collections $2,150
> Adults with any debt in collections: 34.9% — 10th highest
> Median debt in collections, communities of color: $1,969 — 11th highest
> Adults with any debt in collections, communities of color: 46.0% — 24th highest
> Median debt in collections, majority white communities: $2,192 — 6th highest
> Share with any debt in collections, majority white communities: 25.8% — 18th highest

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5. South Dakota
> Median debt in collections $2,185
> Adults with any debt in collections: 16.3% — 2nd lowest
> Median debt in collections, communities of color: $1,707 — 23rd lowest
> Adults with any debt in collections, communities of color: 47.7% — 20th highest
> Median debt in collections, majority white communities: $2,212 — 4th highest
> Share with any debt in collections, majority white communities: 14.9% — 2nd lowest

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3. Idaho
> Median debt in collections $2,227
> Adults with any debt in collections: 21.4% — 13th lowest
> Median debt in collections, communities of color: N/A — N/A
> Adults with any debt in collections, communities of color: 43.9% — 24th lowest
> Median debt in collections, majority white communities: $2,257 — 3rd highest
> Share with any debt in collections, majority white communities: 20.8% — 18th lowest

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3. Oklahoma
> Median debt in collections $2,227
> Adults with any debt in collections: 36.9% — 8th highest
> Median debt in collections, communities of color: $2,216 — 4th highest
> Adults with any debt in collections, communities of color: 56.1% — 8th highest
> Median debt in collections, majority white communities: $2,211 — 5th highest
> Share with any debt in collections, majority white communities: 33.6% — 5th highest

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2. Florida
> Median debt in collections $2,247
> Adults with any debt in collections: 32.5% — 15th highest
> Median debt in collections, communities of color: $2,332 — the highest
> Adults with any debt in collections, communities of color: 39.2% — 17th lowest
> Median debt in collections, majority white communities: $2,185 — 7th highest
> Share with any debt in collections, majority white communities: 27.7% — 16th highest

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1. Wyoming
> Median debt in collections $2,532
> Adults with any debt in collections: 26.1% — 23rd lowest
> Median debt in collections, communities of color: N/A — N/A
> Adults with any debt in collections, communities of color: 78.4% — the highest
> Median debt in collections, majority white communities: $2,532 — the highest
> Share with any debt in collections, majority white communities: 25.7% — 19th highest

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