Utah most debt-ridden state in U.S. Here’s why
Utah is the most debt-ridden state in the nation.
That’s according to a new ranking by the fintech PR firm Cultural Currents Institute, which used data from the Federal Reserve Bank of New York, Forbes and Pew Research Center to examine debt across the U.S., including auto loans, credit cards, mortgages and student loans.
The study showed Utah households are the most indebted in the country, calculating the average Utah household owes 138% of the state’s average annual salary, which is $57,360.
Utah ranks No. 7 highest in the nation for its average auto loan debt, at $6,040, and No. 5 for mortgage debt, at $61,120. Though the Beehive State ranks close to the middle of the pack when it comes to credit card debt, at $3,340, and near the bottom for student loan debt, its middle-ranking salary offers Utahns a high debt-to-salary ratio compared to other states.
Interesting that Utah was ranked as most indebted state in the nation. That's likely due to it being the youngest state in the nation, with many Utahns likely early on in their "financial journey," says Cultural Currents Institute #utecon #utpol https://t.co/39pQSUcx0K pic.twitter.com/N2UDLX3CuY
— Katie McKellar (@KatieMcKellar1) September 5, 2023
Related
Other states with lower salaries (Arkansas and Alabama) and states with higher cost of living (Hawaii and Colorado) follow closely behind Utah.
Even though Utah’s cost of living has increased significantly in recent years — largely thanks to skyrocketing housing costs, as the state was a hot spot for the pandemic housing rush — it has relatively more affordable universities and low credit card debt compared to other states. So why is it the most indebted?
“Utah’s high DTS (debt-to-salary) ratio may find a partial explanation in the state’s demographics,” the CCI study states. “Utah is the youngest state in the union, with a median age of just 31.1 years old. This means that residents of the state are more likely to be early in their financial journey, having had less time to pay down mortgages, auto loans and student debt. Young parents, who are abundant in the state, may also be in a phase of life where paying down debts takes a backseat to the challenges of raising a family.”
Here’s how the study ranked the top 10 states with the highest debt-to-average-salary ratio:
1: Utah 1.38.
2: Arkansas 1.35.
3: Hawaii 1.35.
4: Alabama 1.34.
5: Colorado 1.31.
6: Idaho 1.25.
7: Nevada 1.19.
9: California 1.16.
10: Maryland 1.15.
