Most financially irresponsible states identified: Can citizens really afford it?

Traders are keeping an eye on Washington, after US lawmakers voted to force Tiktok’s Chinese parent company to divest from the platform or see it be banned – Copyright GETTY IMAGES NORTH AMERICA/AFP Anna Moneymaker

In the U.S., financial responsibility remains a challenge for many. The average credit card debt is $6,194 and the level of consumer debt is increasing. Nearly 80 percent of people confess to making splurge purchases in the past month, yet only 42 percent say they can afford them.

This disparity highlights a growing issue around financial pressures to maintain an image of wealth, particularly among younger generations like Gen Z.

A research report indicates the variances across different parts of the U.S. Socially Powerful’s latest research delves into this growing issue, identifying the states with the least responsible spenders.

The top ten identified most financially irresponsible states have been revealed as:

1. Washington
2. Colorado
3. Texas
4. Florida
5. Rhode Island
6. California
7. Georgia
8. Arizona
9. Tennessee
10. New Mexico

The data for this analysis was gathered from a variety of reputable sources across multiple domains which can be found on the dataset, including ICSC, UpgradedPoints, WalletHub, Equifax, Bankrate, Raisin, and Wikipedia.

Ranked #1, Washington scores 8.14/10 for irresponsible spending. Despite placing in the top 10 states for median income ($94,605) and average retirement savings of $469,987, residents carry an average credit card balance of $6,470 and a total interest expense of $870.

With 55 percent of residents shopping online—the highest in the top five—and spending $112.06 monthly on Amazon, Washington’s reliance on e-commerce underscores excessive spending, testified by the average consumer in Washington carrying $136,170 in debt, a 6.9 percent increase from the year before.

Colorado ranks joint second (8.06/10), with a median income of $92,911 and average retirement savings of $449,719. However, residents carry an average credit card balance of $6,574 and face a total interest expense of $957, 10% higher than California ($858). While 50% of Coloradans shop online, their $93.96 monthly Amazon spending suggests rising retail engagement, which is up 1.7 percent from last year.

Texas is the other state in second place, with a score of 8.06/10, carrying the highest average bank card balance of $6,620—and facing a total interest expense of $1,162. With a lower average credit score of 686, Texas’s debt burden is substantial with their $98.66 monthly Amazon spend, correlating with their high stress score of 55/100, placing them in the top 10 most stressed U.S. states.

Florida, with 22.4 million residents, has a score of 8/10. Floridians carry an average bank card balance of $6,550, 15 percent higher than the neighbouring state of Alabama ($5,571).

Financially responsible

When it comes to responsible spending, the Dakotas and Kansas lead. North Dakota, with a score of just 5.63/10, shows the strongest signs of financial responsibility, boasting an average credit card balance of just $5,618—14 percent less than Washington’s average balance of $6,470—and a modest monthly Amazon spend of $92.01.

South Dakota follows closely behind, where residents also keep their credit card balances low at $5,375, while their online shopping habits are equally measured.

Kansas takes the third spot, where residents carry an average bank card balance of $5,575 and maintain a relatively low interest expense of $889—22 percent less than the neighbouring state of Oklahoma’s $1,138.

South and North Dakota also place low in stress scores, with just 31/100 and 35/100 placing them in the seven least stressed US states. Could this point to a trend of stress and overspending going hand in hand?