In today's economic landscape, Americans face a myriad of financial challenges. From rising monthly bills to the burden of credit card debt and the impact of inflation, many find themselves in a state of financial distress. WalletHub has delved deep into this issue, ranking states based on various factors to shed light on where this problem is most prevalent.

Uncovering the States with the Highest Financial Distress

Texas: A Tale of Financial Struggle

In Texas, a significant portion of the residents find themselves in financial distress. As of the third quarter of 2024, a staggering 8.2% of the residents have at least one credit account in forbearance or with deferred payments. This percentage stands as the third-highest in the nation, highlighting the severity of the issue. Moreover, the state has witnessed a 25.8% increase in non-business bankruptcy filings in the past year, ranking seventh-highest in the U.S. It is not surprising that Texas residents frequently search for "debt" and "loans" on Google, as they are desperate to find solutions to their financial woes despite already being in debt.The economic situation in Texas seems to be taking a toll on its residents, with a large number struggling to manage their finances. This not only affects their individual lives but also has implications for the state's economy as a whole.

Louisiana: Navigating the Financial Quagmire

Louisiana emerges as the second-most financially distressed state. In the third quarter of 2024, approximately 11.6% of the state's residents had at least one credit account in financial distress. This occurs when the account holder is temporarily allowed to not make payments due to financial difficulties. While there is a slight year-over-year decrease of 0.8% in the number of residents in distress, Louisiana still has a significant problem. The state also has the third-lowest average credit score in the U.S., at 624, which is in the substandard credit range. Many Louisiana residents are considering using loans to pay their bills, as evidenced by the fact that the state ranks second in Google search volume for "loans."The financial challenges faced by Louisiana residents are complex and require careful attention. Efforts need to be made to improve credit scores and provide better financial education to help them navigate these difficult times.

Nevada: Struggling in the Desert of Finance

In Nevada, around 7.5% of residents have at least one credit account in forbearance or with deferred payments. The state also witnessed an 24.3% spike in non-business bankruptcy filings over the past year, ranking eighth-highest. These factors have contributed to Nevada residents having the 15th-lowest average credit score in the U.S., at 644, which is near the bottom of the fair credit range. Despite this, Nevada residents are still looking to borrow more, with the fourth-highest Google search interest for "debt" and the eighth-highest interest in loans.The financial situation in Nevada is a cause for concern, as the high bankruptcy filings and low credit scores indicate a significant level of financial stress. It is essential to address these issues and provide support to help Nevadans get back on track.To see the complete list of rankings and where your state ranks, click here. Middle-class Americans also admit to financial struggles, as revealed in a separate poll conducted in June 2024. A majority of middle-class Americans, those earning above 200% of the federal poverty level (about $62,300 for a family of four), report being "struggling financially" and expect this to continue for the rest of their lives. This further emphasizes the widespread nature of financial distress across the country.