Alabama ranks in top 10 for most credit card debt

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According to a study done by CreditCards.com, Southern states have the highest amount of credit card debt. When it comes to the burden of debt in the U.S, you might be surprised by just how high Alabama ranks.

Alabama has the 8th highest amount of credit card debt in the U.S.  Behind states like New Mexico at #1, Louisiana, and Mississippi. We sat down with Credit Specialist, Millie Gunn, to talk about why this could be.

Gunn says, “One of the things that I’ve seen, especially down here– because I’m from Michigan– is that we don’t really talk about credit at all.” She adds, “The shame and the guilt and some of the embarrassment that people feel, kind of makes you not want to talk about it.” 

The ranking could be impacted by the fact that Alabama households have the 6th lowest annual income in America, with each household bringing home an average of $49,861. 

Milli Gunn tells us, she knows the struggle that comes along with credit card debt– all too well. And that sadly, this cycle of debt can just come from a lack of information. She says, “My parents told me, whatever you do, don’t mess up your credit. They didn’t quite tell me what that involved. So, I messed up my credit!”

RELATED: Are your kids’ credit scores ruined before they’re even out of the sandbox?

Gunn says monitoring your spending, and checking your credit can stop you from finding  yourself in debt. She even clarifies the difference between a credit score and profile. Gunn tells our reporter, “There’s your score, and there’s your credit profile. Your profile is actually the stuff that’s listed on your credit report that makes up your score. It’s important that you know what’s on your credit report.” 

Milli Gunn tells us, 27 % of your credit score is based off of credit cards and revolving debt. So consulting a credit counselor, creating a plan, and sticking to it is your best bet. She says it’s important to use your credit card sparingly and when you know that you can make the payments in a reasonable amount of time. Gunn adds, “I say use it like a debit card. If you swipe your ‘Redstone’ card, they’re going to take it out immediately. If you swipe your ‘Discover’ card, you should be paying it immediately.” 

The state with the lowest average amount of credit card debt? Massachusetts. but, you have to consider, residents also make over $79,000 a year on average. Massachusetts has one of the top 5 highest incomes in America.

             
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