The Great Debt Trap: Which States Are Drowning in Household Liabilities

Debt to Income: The New Shackles

Measured as a ratio of household debt to annual income (excluding student loans but including mortgages, auto loans, credit cards, etc.), this number tells us how far households are stretched. If you’re at a 2.0 DTI, you owe twice what you bring in each year. That’s not financial living—it’s economic indenture.

And in Q1 of 2025, two states sit squarely at the top of this pile of IOUs: Idaho and Hawaii, both at 2.06. That means for every $1 earned, the average household owes $2.06. That’s debt servitude with a view.

Full State-by-State Breakdown: Household Debt-to-Income Ratios (2025)

Rank	State	Code	DTI (2025)
1	Idaho	ID	2.06
2	Hawaii	HI	2.06
3	Arizona	AZ	1.84
4	Colorado	CO	1.84
5	Utah	UT	1.84
6	Maryland	MD	1.84
7	South Carolina	SC	1.72
8	Nevada	NV	1.72
9	Oregon	OR	1.72
10	Florida	FL	1.72
11	Delaware	DE	1.60
12	Montana	MT	1.60
13	Rhode Island	RI	1.60
14	Virginia	VA	1.60
15	California	CA	1.60
16	Wyoming	WY	1.50
17	Georgia	GA	1.50
18	Maine	ME	1.50
19	North Carolina	NC	1.50
20	New Mexico	NM	1.50
21	Washington	WA	1.50
22	Mississippi	MS	1.40
23	New Hampshire	NH	1.40
24	New Jersey	NJ	1.40
25	Tennessee	TN	1.40
26	Alaska	AK	1.40
27	Alabama	AL	1.32
28	Louisiana	LA	1.32
29	Oklahoma	OK	1.32
30	Vermont	VT	1.32
31	Arkansas	AR	1.24
32	Indiana	IN	1.24
33	Iowa	IA	1.24
34	Kentucky	KY	1.24
35	Massachusetts	MA	1.24
36	Michigan	MI	1.24
37	Minnesota	MN	1.24
38	Missouri	MO	1.24
39	Nebraska	NE	1.24
40	South Dakota	SD	1.24
41	Texas	TX	1.24
42	West Virginia	WV	1.24
43	Wisconsin	WI	1.24
44	Connecticut	CT	1.11
45	District of Columbia	DC	1.11
46	Illinois	IL	1.11
47	Kansas	KS	1.11
48	New York	NY	1.11
49	North Dakota	ND	1.11
50	Ohio	OH	1.11
51	Pennsylvania	PA	1.11

The Calm States: Where Debt is Still Manageable

States like Pennsylvania, Ohio, and North Dakota sit at the bottom of the list with a DTI of just 1.11. Their secret? Modest housing markets, aging populations with equity, and little population churn. They don’t borrow what they can’t repay.

Even high-income zones like Connecticut and D.C. manage to stay low thanks to high wages and disciplined balance sheets.

The Debt Mirage: Why the Numbers Lie

Here’s the kicker: these numbers actually understate the burden for millions. Why?

1. Student Loans Are Excluded – That’s a ticking time bomb deliberately left out of the picture. Add it in, and the true household burden skyrockets.
2. Income Metrics Are Flawed – The data uses unemployment-insurance-covered wages, not full personal income. That means it misses gig workers, retirees, and capital income—skewing ratios in places with booming finance or tech economies.

If you’re a working-age adult in a growth state, this ratio is sugarcoated. The reality? You’re more broke than they’re letting on.

This Isn’t Sustainable—It’s Systemic

This isn’t about reckless consumers—it’s about engineered economic dependency. Debt isn’t just tolerated; it’s encouraged. It props up GDP, props up housing, props up Wall Street. But it chains you to a system that can crush you with a single interest rate hike.

You’re not in control. The debt is.

Call to Action

If you're waiting for the crash, you're already behind. When this debt bomb explodes—whether through defaults, currency collapse, or digital rationing via FedNow—you won’t get a warning.
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