25 States With Lowest Overall Millennial Debt

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Numbering roughly 72 million, according to U.S. Census projections, millennials have overtaken baby boomers as America's largest generation. They've also surpassed baby boomers when it comes to labor force representation, according to the Pew Research Center, and now account for 35% of U.S. workers. With numbers like these, how millennials manage their debt can provide key economic insights.

From the first quarter (Q1) of 2019 to Q1 2021, overall millennial debt grew by 21%, according to Experian data. Pandemic-related student loan deferral or forbearance spurred some of the growth, as interest continued to accrue and existing balances weren't being paid down.

As part of our ongoing look at debt in the U.S., Experian analyzed consumer credit data from August 2021 to see where millennials had the lowest debt balances. Our analysis looked at all 50 states in the U.S., exploring how total debt and the average credit score differed across members of the millennial generation. Mississippi tops the list as the state with the lowest average millennial debt; New York and West Virginia round out the top three. Read on for our insights and analysis on the 25 states with the lowest millennial debt.

  1. Mississippi
  2. Mississippi has the highest rate of poverty of any state in the U.S.; low income could make it harder for millennials here to get credit.

    • Average millennial overall debt: $74,330
    • Average millennial FICO® Score : 644

  3. New York
  4. To match New York's high cost of living, the average income in the state is much higher than the national average, yet the state has the second-lowest average millennial debt.

    • Average millennial overall debt: $81,960
    • Average millennial FICO® Score: 701

  5. West Virginia
  6. One of the poorest states in the nation, West Virginia suffers from a declining coal industry and lower-than-average incomes.

    • Average millennial overall debt: $82,379
    • Average millennial FICO® Score: 659

  7. Alabama
  8. This Southern state boasts a low millennial debt average.

    • Average millennial overall debt: $83,121
    • Average millennial FICO® Score: 653

  9. Arkansas
  10. Home to the first Walmart store, Arkansas has diversified its economy from agricultural to service-sector based.

    • Average millennial overall debt: $83,394
    • Average millennial FICO® Score: 658

  11. Michigan
  12. With the decline of the auto industry, Michigan in recent years has focused on encouraging manufacturing, high-tech and service-sector growth.

    • Average overall millennial debt: $83,681
    • Average millennial FICO® Score: 685

  13. Oklahoma
  14. Oklahoma is among the nation's most affordable states, which may contribute to its low average millennial debt.

    • Average overall millennial debt: $83,824
    • Average millennial FICO® Score: 660

  15. Kentucky
  16. Home of bluegrass music and the Kentucky Derby, Kentucky remains largely rural, with an economy primarily reliant on services and manufacturing.

    • Average overall millennial debt: $84,074
    • Average millennial FICO® Score: 667

  17. New Mexico
  18. America's fifth-largest state by total area has become increasingly urbanized in recent years, but remains one of the poorest states in the nation.

    • Average overall millennial debt: $84,165
    • Average millennial FICO® Score: 664

  19. Ohio
  20. Centrally located, Ohio has long been a hub for trade. Its economy includes service businesses, manufacturing and mining, and it's among the states with the highest millennial in-migration during the pandemic.

    • Average overall millennial debt: $85,090
    • Average millennial FICO® Score: 682

  21. Florida
  22. Boasting no state income tax and a sunny climate, Florida is known as a destination for retirees. Maybe it should also be known for the low average debt of its millennials.

    • Average overall millennial debt: $86,044
    • Average millennial FICO® Score: 671

  23. Georgia
  24. One of the original 13 states, Georgia continues to attract new residents at a steady rate.

    • Average overall millennial debt: $88,452
    • Average millennial FICO® Score: 662|

  25. Indiana
  26. In the heart of the Midwest, Indiana is a major transportation hub, although services now dominate its economy.

    • Average overall millennial debt: $88,678
    • Average millennial FICO® Score: 678

  27. Texas
  28. Texas has consistently been one of the fastest-growing states. That trend continued during the pandemic, when Texas saw the highest net in-migration rate of millennials in the U.S.

    • Average overall millennial debt: $90,425
    • Average millennial FICO® Score: 667

  29. Missouri
  30. Centrally located, Missouri relies on agriculture, manufacturing and service industries.

    • Average overall millennial debt: $91,118
    • Average millennial FICO® Score: 677

  31. Illinois
  32. Illinois boasts a relatively low cost of living and a diverse economy including manufacturing, agriculture, finance, mining, transportation, technology and services.

    • Average overall millennial debt: $91,817
    • Average millennial FICO® Score: 692

  33. Louisiana
  34. Louisiana's subtropical climate, coastal location and cultural melting pot give the state its unique flair. However, it remains one of the country's poorest states.

    • Average overall millennial debt: $92,363
    • Average millennial FICO® Score: 658

  35. Kansas
  36. Kansas has an above-average reliance on agriculture and manufacturing. More young people left Kansas than moved there in 2020, according to the National Movers Study by United Van Lines.

    • Average overall millennial debt: $92,692
    • Average millennial FICO® Score: 690

  37. Pennsylvania
  38. Dominated by service industries, Pennsylvania also has a robust tourist trade. Population growth has been generally flat for decades; during the pandemic, however, Pennsylvania was among the 10 states with the biggest millennial in-migration.

    • Average overall millennial debt: $93,502
    • Average millennial FICO® Score: 693

  39. South Carolina
  40. Manufacturing and service industries anchor South Carolina's economy. Although population growth in the state typically surpasses national averages, that's largely due to retirees moving in; young people tend to move out.

    • Average overall millennial debt: $94,560
    • Average millennial FICO® Score: 656

  41. North Carolina
  42. One of the nation's top manufacturing states, North Carolina also benefits from growing government, technology and scientific sectors. That may be why it's among the states with the highest rate of millennial in-migration during the pandemic.

    • Average overall millennial debt: $94,730
    • Average millennial FICO® Score: 676

  43. Nevada
  44. This sparsely populated state has no income tax; the economy is powered by tourism centered on Las Vegas (home to almost half Nevada's residents) as well as manufacturing and government jobs.

    • Average overall millennial debt: $97,337
    • Average millennial FICO® Score: 670

  45. Delaware
  46. The second-smallest state by area, Delaware is also one of the most densely populated. It's located within 150 miles of four of the country's 10 biggest cities.

    • Average overall millennial debt: $98,127
    • Average millennial FICO® Score: 678

  47. Tennessee
  48. Tennessee is one of the poorest states, but enjoys a low cost of living and no state income tax. During the pandemic, it ranked among the 10 states with the biggest net in-migration of millennials.

    • Average overall millennial debt: $98,249
    • Average FICO® Score: 670

  49. Nebraska
  50. Boasting a lower-than-average cost of living, Nebraska relies on agriculture, manufacturing, tourism and the insurance industry.

    • Average overall millennial debt: $98,296
    • Average FICO® Score: 703

New York State Breaks Trends

Many states on our list are Southern or Midwestern states where millennials are more likely to move out than in. New York, with the second-lowest millennial debt, is an outlier. That may be because almost 43% of New York's population lives in New York City, which residents can easily navigate without a car (or a car loan). The homeownership rate in New York City is just 33%, compared with a national average of 64%, meaning fewer mortgages.

Generation Gap?

Nationwide, the average FICO® Score among millennials is within the "good" credit score range, but below the average U.S. FICO® Score of 710. In fact, in 17 of the 25 states above, millennials' average credit score was even below the national millennial average of 679.

It's typical for younger people to have lower credit scores and for their credit to improve as they age and build a credit history. Still, millennials should keep in mind that paying off debt and making payments on time is crucial to improving credit scores.

Methodology: The analysis results provided are based on an Experian-created statistically relevant aggregate sampling of our consumer credit database that may include use of the FICO® Score 8 version. Different sampling parameters may generate different findings compared with other similar analysis. Analyzed credit data did not contain personal identification information. Metro areas group counties and cities into specific geographic areas for population censuses and compilations of related statistical data.

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