Californians cannot escape the high cost of living, a burden that may also come with steep personal debt.
In a recent report, ConsumerAffairs analyzed Federal Reserve Bank of New York data to determine the most debt-burdened states, and, maybe unsurprisingly, the Golden State ranked in the top 10.
But in California, it’s “less about people falling behind and more about how much they have to take on just to keep up,” said Dayna Edens, media relations manager at ConsumerAffairs.
“The average Californian carries nearly $88,000 in debt, and when you compare that to income, the state has the third-highest debt-to-income ratio in the country,” Edens said. “That tells us many residents are stretched, even if they’re earning more on paper.”
Even with the high debt, however, Californians are typically staying current with their payments, according to Edens.
“That suggests the real pressure point isn’t necessarily missed payments, but the cost of living,” Edens said. “People are managing their debt, but often with very little margin for error.”
Here’s ConsumerAffairs’ methodology, along with what its report found for California and the rest of the nation.
ConsumerAffairs’ methodology
To create its report of the most debt-burdened states, ConsumerAffairs assessed data from the Federal Reserve Bank of New York (fourth quarter of 2025) and income data from the U.S. Census Bureau (2024).
The company then ranked the 50 states and Washington, D.C., using two equally weighted categories:
Both categories were added for a combined possible score of 100 points, meaning “states with the highest overall scores were ranked as the places where residents are most burdened by debt,” according to ConsumerAffairs.
What ConsumerAffairs’ report found for California
ConsumerAffairs’ analysis found that California ranked as the fifth most debt-burdened state in the country.
In the Golden State, residents carry an average debt balance of $87,850 per person, the third-highest in the country. The national average stands at about $63,200.
California has a per-capita income of $49,934, while the national average is $45,256.
Nationally, the average debt-to-income ratio is about 140%, while in California it is about 176%, the third-highest in the U.S.
“This metric alone accounts for half of our overall ranking,” according to ConsumerAffairs.
Most debt-burdened states
Here are the most debt-burdened states, along with their rankings, overall scores, and total debt per capita, according to ConsumerAffairs.
“With the exception of California — a high-income, high-cost-of-living state — there’s a key thread uniting the worst-ranked states: They all have below-average incomes,” ConsumerAffairs said. “Put another way? Residents in these states simply don’t make enough to stay on top of what they owe.”
Also of note, ConsumerAffairs said, is that all the most debt-burdened states are in the West and South.
Least debt-burdened states
Here are the least debt-burdened states, along with their rankings, overall scores, and total debt per capita, according to ConsumerAffairs.
“In a stark contrast to the most debt-burdened states, the 10 least debt-burdened states are exclusively from the Northeast and Midwest,” ConsumerAffairs said.
Of note, according to ConsumerAffairs, is that each of the above states has an average annual income of at least $40,000, “providing a reasonable ‘floor’ to help build a solid financial foundation.”
Debt has climbed nationally since 2003, report finds
“Since 2003, total debt per capita has climbed from $32,840 to $63,200,” ConsumerAffairs said. “In inflation-adjusted dollars, that’s an increase of about 10%.”
During that same time, debt burdens tied to life’s biggest purchases have followed a similar trend, according to ConsumerAffairs. When accounting for inflation, “auto loan debt has increased by 9%, while mortgage debt has increased by 6%.”
Among the different categories, the average personal student loan debt has had the sharpest increase, nearly tripling since 2003, ConsumerAffairs’ analysis found.
This article originally appeared on Palm Springs Desert Sun: California ranks among most the debt-burdened states, report finds
Reporting by Daniella Segura, USA TODAY NETWORK / Palm Springs Desert Sun
USA TODAY Network via Reuters Connect
