10 best cities to get out of credit card debt


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Editor’s Note: This story originally appeared on SmartAsset.com.

The The Federal Reserve says that revolving consumer credit debt – including credit card debt, home equity lines of credit and personal lines of credit – reached $ 974.4 billion in February 2021, marking an increase of 10 , 1% of the annual rate compared to the previous year. This accounts for nearly a third of all consumer debt, which also includes student and auto loans, and totals $ 4.2 trillion. With so many people trying pay off credit card debt, SmartAsset analyzed the numbers to identify and rank the best cities where it is easiest to do so.

To do this, we looked at the unemployment rate, median after-tax income, lower quartile rents, and disposable income to determine where debt could be paid off fastest, assuming average interest rates and debt. total of $ 7,935. For more details on our data sources and how we put all the information together to create our final ranking, see the Data and Methodology section at the end.

1. Frisco, Texas

Frisco, Texas
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Residents of the Dallas suburb of Frisco, Texas can pay off $ 7,935 in credit card debt in 8.59 months. The after-tax income of high school graduates in this city is just over $ 37,000. And with a bottom quartile rent (the most affordable unit one can reasonably afford) of $ 1,126 per month, residents can afford to pay off a monthly debt of $ 979.

2. Reno, NV

Reno, Nevada
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Reno, Nevada, residents can get out of debt of $ 7,935 in 9.43 months. The after-tax income for high school graduates is around $ 31,000 and the bottom quartile rent is $ 787 per month. This means that if they apply 50% of their after-rent disposable income to paying off credit card debt, they can afford a monthly payment of $ 896.

3. Gilbert, Arizona

Gilbert, Arizona
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The median after-tax income of high school graduates in Gilbert, Arizona is $ 35,463. Residents of this city can pay off a credit card debt of $ 7,935 in 9.60 months. And with a bottom quartile rent (the lowest number below which 25% of tenants pay rent) of $ 1,192 per month, monthly debt payments of $ 882 are possible.

4. Mooring, AK

Anchorage, Alaska
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Residents of Anchorage, Alaska can pay off $ 7,935 in credit card debt in 10.04 months. The median after-tax income for a high school graduate is $ 30,650 and the rent for the bottom quartile is $ 863 per month. If a resident uses half of their disposable income to pay down debt, they could make monthly payments of $ 846.

5. Chesapeake, Virginia

Chesapeake, Virginia
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Residents of Chesapeake, Virginia can pay off a debt of $ 7,935 in 10.11 months. The median after-tax income for a high school graduate is $ 29,087. In addition, the most affordable rental unit, in the bottom quartile, costs $ 744 per month. With just over $ 20,000 in disposable income after rent, residents can apply half to monthly debt payments of $ 840.

6. Saint-Louis, Missouri

St. Louis, Missouri
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The median income for high school graduates in St. Louis, Missouri, is just under $ 26,000, and the lower quartile’s total rent is $ 519 per month. If a person with this income and rent adopted a relatively aggressive repayment strategy and spent half of their disposable income paying off $ 7,935 in credit card debt, they would be released from credit card debt by 10.37 months.

7. Fort Wayne, IN

Fort Wayne Indiana
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The median after-tax income of high school graduates in Fort Wayne, Indiana is $ 24,881 – the lowest in the top 10 in this study. The lower quartile rent (the most affordable unit one can reasonably afford) in this city is $ 496 per month. Someone with almost $ 19,000 in disposable income after rent could pay a total credit card bill of $ 7,935 in 10.81 months.

8. Lincoln, NE

Lincoln, Nebraska
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The median after-tax income for a high school graduate in Lincoln, Nebraska, is $ 25,828. And the lower quartile rent in this city is $ 589. If residents could afford to spend half of their disposable income after rent on paying off, they could pay off a $ 7,935 credit card bill in 10.91 months.

9. Tulsa, okay

Tulsa, Oklahoma
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Residents of Tulsa, Oklahoma, could pay off $ 7,935 in credit card debt in 10.98 months. This is based on a median after-tax income of $ 25,038 and a bottom quartile rent of $ 532, meaning they could afford a monthly debt payment of $ 777 using a relatively aggressive repayment strategy.

10. Oklahoma City, okay

Oklahoma City, Oklahoma
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Oklahoma City, Oklahoma, is the most populous in the top 10 on this list, and it has a median after-tax income of $ 25,125 for high school graduates. The lower quartile rent is $ 558 per month. Using a relatively aggressive repayment strategy, a resident who spends half of their disposable income after rent on debt could pay a credit card bill of $ 7,935 in 11.12 months.

Data and methodology

Plastic
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In order to find the best places to pay off credit card debt, we’ve created a credit card debt payment template for 56 cities. To determine our list of cities, we excluded cities with less than 200,000 inhabitants and those with below-average unemployment rates.

To complete the analysis, we first calculated the amount of disposable income a high school graduate might have in each city, assuming they earn the median salary of high school graduates with no further education. Using SmartAsset’s Income Tax Calculator, we found the after-tax income of local high school graduates. We then subtracted the annual rent from the bottom quartile to obtain the disposable income of an average high school graduate. The lower quartile rent is the lowest number below which 25% of tenants pay rent.

We then assumed that high school graduates would spend half of their disposable income on credit card payments. Using this figure, we calculated how long it would take to pay off $ 7,935 in credit card debt, which was determined by dividing the estimated outstanding credit card debt by the number of households. in the United States in February 2021. We also assumed that consumers would pay 15.91% interest, which was the estimated average credit card interest rate, according to the Federal Reserve.

Data on population, median income of high school graduates, and lower quartile rent are from the 2019 U.S. Census Bureau’s one-year community survey. Unemployment figures for February 2021 are from the Bureau of Labor Statistics (BLS) and are measured at the county level.

Disclosure: The information you read here is always objective. However, sometimes we do receive compensation when you click on links in our stories.


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