ALBUQUERQUE, N.M. — Relative to their income, New Mexicans carry the highest level of credit card debt in the country, according to a recent study.
A report from CreditCards.com, which produces credit card reviews and industry news, ranks New Mexico 51st — behind 49 other states and Washington D.C. — in average debt burden relative to income. Using the study’s methodology, it would take longer for the average New Mexico resident to pay off his or her credit card debt than it would for residents of any other state, according to Ted Rossman, industry analyst for the website.
Rossman said the high debt burden could put New Mexico residents at a greater risk of falling behind on payments in the event of an economic downturn.
“Just keeping up is not enough,” Rossman said.
The study combined data from the U.S. Census Bureau and the consumer credit reporting agency Experian and assumed that 15% of monthly income would go toward paying off credit card debt.
New Mexico was middle of the pack in terms of raw debt. Its average credit card debt was $8,356, 23rd-highest in the country and ahead of neighboring states like Arizona, Colorado and Texas. However, because New Mexico’s median household income was the fourth-lowest in the country, the debt would take much longer to pay off using 15% of monthly take home pay than it would in most other states, Rossman said.
“What we found in the study is, all else being equal, it’s really advantageous to be in a high-income state,” Rossman said.