Dallas, we have a debt problem. A new study by CreditCards.com puts Dallas-Fort Worth at No. 5 in the nation for length of time to pay off credit card debt and interest accrued.
In DFW, it takes the typical worker 19 months to pay off the average credit card balance ($7,171). Dallas is in good company, though; two other Texas metro areas, San Antonio (No. 1) and Houston (No. 3), also rated among the worst areas for credit card debt in the country.
CreditCards.com compiled 2017 data from credit-reporting bureau Experian to come up with its ranking of 25 large U.S. metro areas based on the credit card burden shouldered by their residents. The website looked at each metro area’s average credit card balance in relation to income, using median earnings per worker.
“By computing how long it would take to pay off the average balance, the analysis measures not just the dollar size of credit card debt, but also how heavily it weighs on consumers’ budgets,” CreditCards.com notes.
The CreditCards.com study found that it takes the typical San Antonio worker 22 months to pay off the average credit card balance ($7,070). In Houston, it takes the typical worker 20 months to pay off the average credit card balance ($7,121), according to the study.
By contrast, the typical earner in San Francisco — the metro area with the lightest credit card burden — needs only 13 months to pay off the average balance there. CreditCards.com points out that the San Francisco area’s credit card burden is low thanks, in part, to having the second-highest median income among the 25 metros.
Texas cities also had above-average increases in card balances from 2016 to 2017, the survey shows. During the same period, jobs recovered from the sharp dip they took during 2014-2016, when a slowdown in the energy industry nearly put Texas into a regional recession.
“Some expansion of credit can be an indication of a healthy household balance sheet,” the website notes. As the job market improves, people may loosen their purse strings and make up for spending that was put off during lean times, it says.