Connecticut residents experience some of the lowest amounts of financial distress in the country, at least according to a recent survey from WalletHub. That report though, might not provide a comprehensive picture.
The survey, which was released on Thursday, took a narrow view of “financial distress,” zeroing in on credit-based assessments such as average credit scores and credit accounts with missed or delayed payments.
Nearly all of the New England states ranked very high by these metrics. New Hampshire, Massachusetts, Maine and Rhode Island had the four best ratings, respectively, while Connecticut received the ninth best. Vermont came in close to the middle of the pack.
Connecticut ranked best in overall credit scores, with lower averages for people with accounts in distress, overall accounts in distress, and changes in bankruptcy filings. No score placed Connecticut in lower than 20th place.
While this is great news for people in Connecticut dealing with credit card or loan debts – since this report indicates that most people can at least make minimum payments on time and generally avoid taking on so much debt as to need bankruptcy protection – it does not represent a full picture of Connecticut’s financial hardships.
For one, it does not account for people who do not have access to credit. In Connecticut, 18.2% of adults have no access to credit cards, amounting to about 272,000 households. Additionally, many households have either no access to bank accounts (4.4%) or are lacking in adequate access to banking services (15.6%). These are lower numbers than national averages.
The survey also did not account for the amount of debt carried by those adults who do have access to credit, which is mounting in Connecticut particularly. According to loan company Lending Tree, Connecticut residents carried an average credit card debt of $9,408 per holder during the first quarter of 2023. That placed the state as the one with the largest per-borrower debt in the nation. Across the country, credit card debt has reached the highest levels since the Federal Reserve Bank of New York started keeping records in 1999, and those numbers are expected to climb.
Meanwhile, a September report out of the United Way noted that Connecticut families need much higher incomes to afford basic necessities in 2023. The report argued that a family of four in Connecticut had to make at least $106,632 per year to make ends meet, while a single adult needed $33,000 per year. Meanwhile, 39% of families in the state struggled to afford things like food, rent, utilities, and other necessities.
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