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Red vs. Blue: Which States Have More Personal Debt?

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With the 2016 presidential election now less than two weeks away, you’ve likely been seeing several electoral maps filling your Twitter feed as well as 24-hour news channels constantly running through likely map scenarios for November 8th. As has become customary over the past few cycles, these maps break the country down into red states, which are likely to be won by Republicans, and blue states, which tend to vote Democrat, in addition to the always important swing states. So what does all this have to do with personal finance? One FinTech lender recently sought to find out how the personal finance habits of those in red, blue, and purple states compared to one another.

According to a new infographic released by peer to peer loans leader Lending Club, those living in blue states tend to have slightly higher outstanding personal loan and credit card balances than those in red states — $8,465 in personal loans and $5,294 in credit cards compared to $7,472 and $5,029 respectively. However the red states saw more delinquencies on those personal loan debts. Interestingly the swing (or battleground or purple) states were right in the middle, averaging $8,295 in personal loan balances and $5,181 on credit cards. Let’s take a closer look at which states in particular had the best and worst averages.

The 5 Worst States for Debt

When it comes to states with the highest average debt, that dubious honor was split by the 49th and 50th states in the union: Alaska and Hawaii. First, residents of the blue — and not just because it’s in the ocean — state of Hawaii were found to have the highest personal loan debt. With an average balance of $11,327, Hawaii is one of only four states to hit five digits of loan debt. Meanwhile Alaska, a red state — and not just because of its proximity to Russia — ranked #1 in credit card debt, averaging $6,778.

5 Worst States for Personal Loan Debt

  1. Hawaii – $11,327 (Blue)
  2. New Jersey – $10, 808 (Blue)
  3. Montana – $10,330 (Red)
  4. Connecticut – $10,074 (Blue)
  5. Maryland – $9,996 (Blue)

5 Worst States for Credit Card Debt

  1. Alaska – $6,778 (Red)
  2. Virginia – $6,020 (Battleground)
  3. Maryland – $5,919 (Blue)
  4. Connecticut – $5,875 (Blue)
  5. New Jersey – $5,818 (Blue)

On the opposite end of the spectrum, citizens of Iowa and New Mexico have something to celebrate when it comes to their debt. The battleground state of New Mexico not only has the lowest personal loan debt in the nation but, with an average of $5,480it amounts to less than half that of Alaska. Iowa ranks as the home of the lowest credit card debt in the country. According to the Lending Club data, residents of this Red-ish state owe an average of $4,299.

5 Best States for Personal Loan Debt

  1. New Mexico – $5,480 (Battleground)
  2. Oklahoma – $5,748 (Red)
  3. Maine – $5,910 (Blue)
  4. Missouri – $6,040 (Red)
  5. Texas – $6,121 (Red)

5 Best States for Credit Card Debt

  1. Iowa – $4,299 (Red-ish)
  2. North Dakota – $4,485 (Red)
  3. Wisconsin – $4,504 (Blue-ish)
  4. Mississippi – $4,534 (Red)
  5. Nebraska – $4,611 (Red)

Of course the winner of the presidency will ultimately govern all of us, regardless of a state’s red or blue status. With that in mind the graphic also looked at totals debts by type throughout the entire United States. Overall household debt will reach a massive $12.29 trillion this year, up from the $10.56 trillion Americans held during the last presidential election in 2012. About three-quarters of that amount come from mortgages ($8.36 trillion) while student loans, which have been a hot topic during this election cycle, account for $1.26 trillion. Auto loan debt accounts for another $1.1 trillion while credit card balances currently sit at $729 billion.

While it’s hard to say for sure that there’s a correlation between the politics of a state’s population and their monetary habits, it is interesting to see this data broken down by state. Furthermore, just as pundits are champing at the bit to see which states change their color next month, it will be fascinating to see how these figures might change come 2020. So, come November 8th, be sure to vote and then perhaps take a look at how you can pull yourself out of debt.

Average American Household Debt By State

Courtesy of: Lending Club

This article by Jonathan Dyer first appeared on Dyer News and was distributed by the Personal Finance Syndication Network.

 




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