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US places with most credit card debt

Americans have accumulated a lot of credit card debt. At the start of 2022, the total amount was over $1 trillion, according to WalletHub.

But the median balance owed varies widely by state. To see where borrowers owe the most, personal finance website WalletHub analyzed TransUnion’s balance and payment data for people living in all 50 states and the District of Columbia in September 2021.

WalletHub also calculated how long it would take to pay off the median amount of debt in each state along with the accompanying finance charges, assuming an interest rate of 16.17%.

Here are the seven places in the United States with the highest median credit card debt. The cost to repay is displayed as a negative number because it represents the amount of money spent on interest to pay off the debt.

1.Alaska

Median credit card debt: $3,206

Cost to be reimbursed: -$392

Time until payment: 17 months and 27 days

2. District of Columbia

Median credit card debt: $2,788

Cost to be reimbursed: -$328

Time until payment: 17 months and 3 days

3.Washington

Median credit card debt: $2,471

Cost to be reimbursed: -$249

Time until payment: 14 months and 21 days

4. Vermont

Median credit card debt: $2,181

Cost to be reimbursed: -$216

Time until payment: 14 months and 12 days

5.Wyoming

Median credit card debt: $2,324

Cost to be reimbursed: -$229

Time until payment: 14 months and 10 days

6. Oregon

Median credit card debt: $2,208

Cost to be reimbursed: -$217

Time until payment: 14 months and 7 days

7.Montana

Median credit card debt: $2,227

Cost to be reimbursed: -$219

Time until payment: 14 months and 7 days

One of the reasons people accumulate credit card debt is that credit cards are accessible and easy to use. Eileen Milliken Beiterprogram director and associate professor of accounting at Nazareth College, WalletHub told WalletHub.

“Credit card debt is designed to grow because of high interest rates and the power of compounding,” Beiter said. “It’s easy for people to make the minimum payment on credit cards, and the balance keeps growing.”

And with the Fed raising interest rates another 0.75%, outstanding credit card debt could become even more expensive.

In order to start tackling your debt, Beiter says to start by understanding your cash flow: “What are you earning and what are your expenses?” From there, “take stock of your debt”, in order to know what you owe.

She also recommends determining what motivates you to pay it back. “Ideally, you can focus on paying off debt with the highest interest rate, but if eliminating debt with smaller balances motivates you first, go for it,” he said. she told WalletHub.

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