Colorado Ranks Fourth for Credit Card Debt Payoff Time

By North Forty News Staff | NorthFortyNews.com

WalletHub study finds Colorado residents need more than 13 months to pay off the median credit card balance.

Colorado ranks fourth in the nation for the longest projected credit card debt payoff timeline, according to a new study from personal finance website WalletHub.

The report estimates the median Colorado credit card balance is $3,307. Based on the state’s median income of $70,510, the typical resident would need 13 months and 15 days to pay off that balance, accruing approximately $405 in interest along the way.

The findings come as Americans are projected to add another $100 billion in credit card debt this year, bringing the national total to nearly $1.4 trillion.

WalletHub analyst Chip Lupo said repayment habits often matter as much as the amount of debt people carry.

“Looking at the median credit card debt in a state can give you a good idea of whether people are struggling or doing well compared to people in other states, but it’s also important to look at how much residents put toward paying their debts off each month,” Lupo said. “Low average payments lead to long payoff timelines, which in turn lead to high amounts of interest accrued.”

Financial experts cited in the report said impulse spending, using credit cards for routine expenses, paying only the minimum balance, and failing to budget are among the most common behaviors that lead to mounting credit card debt.

The report also notes that some borrowing can be beneficial when it supports long-term financial goals, such as paying for education, purchasing reliable transportation needed for work, or covering true emergencies. Experts recommend building an emergency fund, creating a realistic budget, and reviewing finances regularly to better prepare for unexpected expenses and reduce reliance on high-interest credit.

WalletHub based its rankings on data from TransUnion, the Federal Reserve, and the U.S. Census Bureau, using its proprietary credit card payoff calculator to estimate repayment timelines and interest costs.

Source: WalletHub