10 States Where People Have the Lowest Net Worth

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Not all states are created equal when it comes to debt loads and net worth of the average household. While some states boast an average net worth of nearly $1 million — others have a high percentage of residents with a negative net worth.

We’ll explore the data to show which states have the lowest net worth, and how location can play into the wealth of your household.

Average Debt in American Households

According to research by SmartAsset, the average total household debt in America is around $147,919 (including mortgage debt). But not all locations have similar debt loans — and certain states in the U.S. have a lower overall net worth than others.

And while a higher debt load doesn’t necessarily mean that a household is financially unstable, the data shows clear distinctions in the overall household net worth in certain locations versus others. And some states with the most households that have a negative net worth also have many high net worth households — showing a wealth gap in those locations.

10 States Where the Most Households Have a Negative Net Worth

While the median American household has an overall net worth of around $176,500 (according to data from the U.S. Census Bureau), there are many states that have a high percentage of households with a negative net worth. Your net worth becomes negative when your debt balances exceed the value of your assets (home equity, investments, cash, etc.)

Here are the 10 states where the most household have a negative net worth:

Wyoming

Wyoming is the least populous state in the U.S. — and 20% of the population have a zero or negative net worth. This means that one-fifth of the population has as much debt (or more) than they have assets. 

But what’s wild is that more households in Wyoming have a net worth of $500,000 or more — with 26.4% of households holding this net worth status. This showcases one of the widest wealth gaps in any state.

West Virginia

West Virginia is another state that has nearly 20% of its population with a zero or negative net worth (currently at 19%).

The sparsely-populated state has seen a decline in industry due to its heavy reliance on fossil fuels and coal. With the rise of “green” power and electric cars, West Virginia has struggled to adapt, and many households are struggling financially.

But nearly 50% of households have a net worth of $100,000 or higher — much of this to do with home equity from the recent housing boom. This doesn’t mean that there isn’t a wealth disparity, though, and those with no mortgage or a large investment portfolio can live well in the lower cost-of-living areas around West Virginia.

Nevada

Nevada — the home of Sin City (Las Vegas) — has 18.8% of households with a negative net worth. Part of this is due to Nevada’s tourist-heavy industry focus, low minimum wage and low-paying service jobs. 

But 28.2% of Nevada households have a net worth of $500,000 or more, so a decent chunk of the population might be doing well. Nevada may have been affordable in the past, but housing prices have made living in Nevada on a low income difficult to sustain.

Alabama

Alabama is a Southern state with 16.8% of households with a zero or negative net worth. Alabama is known as one of the poorest states, mostly to do with political, societal and economic policies. Over 34% of households boast a $100,000 to $499,000 net worth, so many households may be doing well, in spite of economic challenges in the state.

Oklahoma

Oklahoma has 16.7% of households that have a zero or negative net worth. A low minimum wage and an abundance of low wage jobs is a contributing factor. Oklahoma also leads the nation in incarcerating non-violent offenders, which can hurt household finances. Only 18% of Oklahoma residents have a net worth of $500,000 or above.

Georgia

Over 16% of Georgia households have a negative or zero net worth. This means millions of households in the Southern state are struggling financially. Part of this is due to an abundance of low-wage agricultural work that can’t keep up with the rising cost of inflation. Over 50% of households do have a net worth of $100,000 or more, with 23.8% of those having a net worth over $500,000.

New York 

One of the most populous states in the U.S., 15.4% of New York households have a net worth that is at zero or negative. Part of this may be due to the extremely high cost of living, and much of New York is actually rural and does not offer high-income jobs. But New York is wealthy, with 53% of households holding a $100,000 net worth or higher, and 26.7% of those households have $500,000 in wealth or more.

Virginia

Virginia has 14.9% of households with a zero or negative net worth. But Virginia is rich, too, with 63% of households holding a $100,000 net worth or higher! And 34% of households have a $500,000 net worth or higher! With many high-paying federal jobs and rising house prices in recent year, this wealth gap isn’t surprising.

Michigan 

Michigan has 14.4% of households with a negative or zero net worth. This means that these households typically have more debt than assets, and not much invested. But over 56% of households have a $100,000 net worth or higher, so many residents may be doing well financially.

Tennessee

Tennessee is a Southern state that has 14.3% of households with a zero or negative net worth. This means that one-eighth of the population is struggling financially, and has more debts than assets. But 55% of all households hold a $100,000 net worth or higher, too.

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