Non-Mortgage Debt Is Widely Decreasing — Except in These 5 States
Written by
Rafaela Stalbalk Klose
Edited by
Amber Barkley
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As Americans embrace healthier financial habits and work to reduce debt, many have successfully cut down non-mortgage balances, including credit card, auto and personal loans. By the second quarter of 2024, most states reported declines in these debts.
However, a few states stand out with rising non-mortgage debt, defying the national trend. A recent report from Experian highlighted these states, exploring the economic factors and unique conditions driving this divergence.
Also, find out which states have the most personal debt.
Alaska
- Non-mortgage debt increase: 1.3%
In 2024, Alaska’s average non-mortgage debt reached $24,643 per person.
Living in Alaska comes with unique financial challenges that make it tough for residents to cut back on debt. The state’s remote location means everyday essentials are more expensive, often forcing people to lean on credit just to cover basic costs. With limited public transportation, owning a car is a must, leading to high auto loan balances.
And for many Alaskans, income isn’t steady; industries like oil and fishing can fluctuate, pushing people to rely on credit as a backup when times are tight.
These combined factors create a unique situation where managing and reducing debt is especially challenging for Alaskan residents.
California
- Non-mortgage debt increase: 0.3%
In 2024, California’s average non-mortgage debt ticked up to $21,444 per person. This increase reflects California’s unique financial pressures: High living and housing costs often mean residents rely on credit just to manage everyday expenses. In many areas, limited public transportation makes owning a car essential, adding to auto loan balances.
And with economic ups and downs in industries like tech and entertainment, income for many Californians can be unpredictable, leading them to turn to credit as a financial safety net.
These combined factors make it particularly challenging for residents to get ahead on debt in a state where costs are some of the highest in the nation.
Hawaii
- Non-mortgage debt increase: 0.2%
In 2024, Hawaii’s average non-mortgage debt rose slightly to $19,781 per person.
Living in Hawaii comes with high costs due to its remote location, which raises the prices of everyday goods and services. For many, limited public transportation options make owning a car essential, adding auto loans to their financial burdens.
Hawaii’s heavy reliance on tourism and agriculture also means income can be unpredictable, pushing people to use credit as a safety net during slower periods.
All of these factors together make managing and reducing debt particularly tough in Hawaii, where residents feel the weight of high expenses and credit dependence.
Nevada
- Non-mortgage debt increase: 0.1%
In 2024, Nevada’s average non-mortgage debt rose slightly to $24,391 per person.
With a growing population and rising housing costs, many residents find themselves relying more on credit to keep up with everyday expenses. Limited public transportation options mean car ownership is essential for most people, which adds auto loans to their financial load.
On top of this, Nevada’s economy heavily depends on tourism and gaming, industries that can be unpredictable, making it another state where people are likely to use credit as a safety net when incomes are low.
These combined factors make it tough for Nevadans to get ahead on debt, even as many across the country manage to cut back.
New Mexico
- Non-mortgage debt increase: 0.1%
In 2024, New Mexico saw a small increase in non-mortgage debt, bringing the average to $25,872 per person.
Many New Mexicans face income instability, especially in sectors like oil and gas, which can lead people to rely on credit during tougher times.
Rising living costs and a growing population have also made daily expenses harder to manage without credit. New Mexico has limited public transportation options, so it’s another state where owning a car is essential for most residents, meaning many have auto loans.
Altogether, these factors make it hard for New Mexicans to get ahead on debt, even as the rest of the country makes progress.
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