Phoenix Ranked Among America’s Most Debt-Stricken Cities, New Study Reveals

By Staff Reporter |

A recent study conducted by LendingTree reveals that Phoenix ranks as one of the most indebted cities in the United States. The analysis places Phoenix 18th among the 50 largest metropolitan areas in terms of debt, with the average resident holding over $39,000 in debt, which exceeds the national average of around $37,800 for nonmortgage debt.

According to data from the Census Bureau, the average income for residents of Phoenix is $79,600, surpassing the national median household income of approximately $75,100. However, the average debt amounts to nearly half of the city’s median income, highlighting a concerning financial landscape.

LendingTree’s findings were based on anonymized credit reports from about 210,000 users on their platform, gathered from April to June of this year. Nonmortgage debt categories include auto loans, student loans, credit cards, personal loans, and other debts excluding mortgages.

The study indicates that nearly 97 percent of consumers in Phoenix carry nonmortgage loan debts, consistent with the averages across the top 50 metropolitan areas. Specifically, 45 percent of residents have auto loan debt, 85 percent are burdened with credit card debt, and 24 percent share personal and student loan debts.

Phoenix’s average auto loan debt is particularly significant, ranking 11th nationally at nearly $14,000, well over the state average of around $6,000. This type of debt constitutes the largest portion of average debts for Phoenix residents, similar to trends observed in 26 other major metropolitan areas.

Further insights reveal that the average credit card debt in Phoenix stands at just over $8,200, while personal loan debt averages around $4,200, and student loan debt exceeds $10,300. In comparison, the state’s average for credit card debt is over $6,300, indicating higher levels of indebtedness in the city.

At the end of the previous year, Arizona itself was situated among the top ten states for average unsecured personal loan debts, estimated at approximately $12,300. Additionally, Arizona saw one of the highest increases in average household debt, rising by more than $700 to total over $429.6 billion statewide.

Interestingly, Phoenix’s average student loan debt is less than that of the state, which averages nearly $35,700, affecting about 902,600 borrowers. Notably, Phoenix is the only city from Arizona that appears in LendingTree’s top-50 ranking.

The study also highlights Texas cities dominating the debt rankings, with Austin, San Antonio, and Houston taking the top three positions. Conversely, San Jose, California; Louisville, Kentucky; and Milwaukee, Wisconsin, exhibited the lowest levels of debt among the surveyed metropolitan areas.