This Map Shows The Average Credit Score In Every State

Casey Bond

It’s been a little more than 10 years since the financial crisis that kicked off the Great Recession. How are Americans’ finances faring today? Credit reporting agency Experian sought to find out with their latest State of Credit report, which examined today’s consumer credit behaviors ― including how credit scores break down for each U.S. state.

2018 Credit Score Rankings

As part of the annual study, Experian compared credit scores by state and ranked them by their average score in 2018. The top five states were Minnesota, South Dakota, Vermont, New Hampshire and Massachusetts, with average credit scores of 703 or higher. Mississippi, Louisiana, Nevada, Georgia and Texas took the five lowest spots, with average scores below 659.

New data from Experian shows the average VantageScore (range 300 – 850) in each state as of 2018.  (Photo: )
New data from Experian shows the average VantageScore (range 300 – 850) in each state as of 2018.  (Photo: )

Though it’s difficult to pinpoint why, exactly, credit scores are higher or lower in certain states, one clear factor is credit utilization. “The one thing that’s consistent across the states is that the utilization rate on revolving accounts is lower in the northern tier than it is in the states with the worst average score,” said Rod Griffin, director of consumer education and awareness for Experian.

Scoring companies recommend that you keep credit utilization under 30 percent; the best-scoring state of Minnesota has an average utilization rate of 26 percent, while Mississippi sits at 35 percent.

“The state rankings follow that utilization rate from top to bottom. So, I think that’s a really telling factor,” Griffin said.

Aside from that, there are many other factors that can influence scores, such as education levels, job markets, cultural approaches to using credit and others.

Credit Scores On The Rise

Though average credit scores aren’t as high as they were before the recession hit, the report found that overall, credit scores have improved since 2008. In fact, 2018 saw the biggest year-over-year increase in scores since 2008, up five points from 2017 for an average score of 680.

“A credit score of 680 falls into what we think of as ‘near-prime’,” said Rod Griffin, head of consumer education for Experian. “It’s good ― not great ― but it is an average so that makes sense,” he said, explaining that the real positive is that scores grew by five points. “It maybe doesn’t sound like a lot, but it really is.”

What’s driving that growth? Griffin said that the economy has improved, consumer confidence has grown, the unemployment rate has decreased and people have generally become more financially stable since 2008.

“Scores tend to be a bit of a lagging indicator in that way,” he said. “As people become more confident in their financial situation, they’re able to use credit as a financial tool ... and scores tend to increase as result.”

The report also found that the average person carries 3.04 credit cards, down slightly from 3.06 in 2017. Average credit card balances increased to $6,506, up $152 over the previous year.

Younger Generations See The Biggest Improvements

It’s clear that younger Americans have seen the most rapid improvements.

Even though those aged 18 to 21 saw increased average credit card balances ― up $203 from 2008 ― they also experienced a 23-point increase in credit scores. That was the largest score increase of any age group.

Those aged 22 to 35 had the second-largest increase in average credit scores since 2008, and also lowered their credit card balances by $990.

“Millennials have been reticent to use credit, and now that they are, they’re using it well,” Griffin said.

On the other hand, those aged 72 and older saw the most significant drop in average credit scores ― 772 in 2008 versus 732 in 2018 ― for a total decrease of 40 points. This group also experienced the largest increase in credit card balances, up $767 between 2008 and 2018 for a total of $4,703. They also experienced the largest increase in mortgage debt, up $29,602 for a total of $160,735 in 2018. Still, this age group continues to have the highest scores on average.

“Relative to the other generations, they’re still managing credit very well. But there are increases in areas that we haven’t seen as much in the past,” Griffin said.

Increasing Credit Awareness

Though the results of the State of Credit report are certainly interesting and may point to important larger trends, the most important takeaway is perhaps not the actual data.

“We want people to be aware of credit reports and credit scores and the importance of their financial lives, and understand that having good credit reports and credit scores are really key to achieving financial inclusion and being more financially successful,” Griffin said.

To find out where you stand credit-wise, start by requesting copies of your credit reports. You’re entitled to a free credit report from each of the three major credit bureaus once a year through annualcreditreport.com. Review your reports for errors, and learn how certain factors such as number of accounts, types of credit and more impact your score. There are several ways to see your credit score for free as well.

Related Coverage

7 Ways You Can Harm Your Credit Score Without Knowing It

Credit Report vs. Credit Score: What's The Difference?

A Perfect Credit Score Of 850 Is Possible, But It Probably Doesn't Matter

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Roll Over Your Old 401(k)

&ldquo;Employees should consider rolling over an old 401(k) or 403(b)&nbsp;<a href="https://www.huffpost.com/topic/retirement">retirement</a>&nbsp;plan into an IRA, which typically takes a matter of minutes. Though the money in the old plan will continue to grow tax-deferred, investors can end up paying much higher fees in an employer-sponsored retirement plan such as a 401(k) due to expensive fund options and plan administration costs. Those fees eat directly into an individual&rsquo;s potential return. The savings can be significant if you switch to an IRA &mdash; even close to 1 percent in some cases. Over time, that can really add up.&rdquo; ―&nbsp;<i>Kristin McFarland, a wealth advisor and certified financial planner at&nbsp;<a href="https://darrowwealthmanagement.com/" target="_blank" rel="noopener noreferrer">Darrow Wealth Management</a>&nbsp;in Boston.</i>

Switch Banks

&ldquo;If you aren&rsquo;t earning at least 1 percent on your savings, you&rsquo;re leaving money on the table. By simply switching from a traditional brick-and-mortar bank to a high-yield&nbsp;<a href="https://www.huffpost.com/topic/savings-account">savings account</a>, you can make your money work harder for you and earn on your savings effortlessly. It takes just a few seconds to compare interest rates between financial institutions to find the best option for you; opening a high-yield online savings account can be done in a matter of minutes.&rdquo; ―&nbsp;<i>Andrea Woroch,&nbsp;<a href="http://www.andreaworoch.com/" target="_blank" rel="noopener noreferrer">consumer savings expert</a></i>

Negotiate With Your Internet Provider

&ldquo;Call your internet provider and negotiate your bill. Let them know your budget has changed and you are shopping around. Providers usually have some sort of special promotion going on that they&rsquo;ll offer you. For example, my provider once offered a huge discount for college students and gave us our internet for half price during the school year. Spending 10 minutes on the phone saved us around $300-$400.&rdquo; ―&nbsp;<i>Jaime Gibbs, a faith and finance blogger at&nbsp;</i><a href="http://likeabubblingbrook.com/"><i>Like a Bubbling Brook</i></a>

Complete A Health Assessment

&ldquo;Many people don&rsquo;t realize that their health insurance provider offers the option to complete a health assessment, which means they miss out on hundreds of dollars each year. Ours has typically been a simple online survey that takes about 20 minutes to complete. In exchange (no matter what the results), we get $150 in gift cards for every insured person over 18.&rdquo; ―&nbsp;<i>Val Breit, owner of personal finance blog&nbsp;</i><a href="http://thecommoncentsclub.com/"><i>The Common Cents Club</i></a>

Sign Up For Auto-Pay

&ldquo;If you follow a reasonable budget, setting your bills to auto-pay is a great way to save time and money. Start by looking at your monthly mandatory expenses and find a company that incentivizes customers to sign up for automatic billing. Usually, they&rsquo;ll offer a reduced interest rate or discounts on future transactions, depending on what type of bill it is. If you&rsquo;re going to have to pay a bill eventually, why not get a discount for doing it automatically? Common places to find discounts can include student loans, car loans or utilities such as your electric bill. And the biggest perk? You don&rsquo;t have to worry about remembering to pay the bill in full each month ― it&rsquo;s all taken care of.&rdquo;&nbsp;<i>― Ben Huber, owner of&nbsp;</i><a href="https://www.dollarsprout.com/"><i>Dollar Sprout</i></a>

Rethink Your Health Insurance

&ldquo;Re-evaluate your health insurance options at work since now is enrollment time. What did you sign up for in the past that you now don&rsquo;t need? For example, I knew someone who had health insurance and cancer insurance. The cancer insurance, which she did not need, was $100 a month. She removed it for instant savings.&rdquo;&nbsp;<i>― Ja&rsquo;Net Adams, speaker, author and creator of&nbsp;</i><a href="https://www.debtsucksuniversity.com/"><i>Debt Sucks University</i></a>

Skim Your Bank Statements

&ldquo;Spend 30 to 60 minutes one evening and review your past two to three months of bank statements. You might find your bank is charging you monthly maintenance fees that can be avoided and save you a couple hundred dollars a year. One way to avoid monthly fees is to enroll in direct deposit or, if you can, keep at least $1,000 in your checking account.&rdquo; ―&nbsp;<i>Jason Reposa, CEO and co-founder of&nbsp;</i><a href="https://www.mybanktracker.com/"><i>MyBankTracker</i></a>

Listen To A Personal Finance Podcast

&ldquo;There are many out there, which can be from a few minutes long to almost an hour. These types of podcasts will greatly impact your knowledge and help you to learn how to save money at no cost to you. And you also aren&rsquo;t spending hours to learn, either. It&rsquo;s something I do each week and has helped me make smarter money choices.&rdquo; ―&nbsp;<i>Todd Kunsman, founder of&nbsp;<a href="https://investedwallet.com/" target="_blank" rel="noopener noreferrer">Invested Wallet</a></i>

Switch To A Prepaid Cellphone Plan

&ldquo;Call your cellphone provider and ask about their prepaid pricing plans. With a few minutes on the phone, you can save $15 or more per month ($180+ per year), plus increase your data limit. After switching to prepaid, we saved $15 a month and increased our data from 3GB shared to 10GB each (20GB total).&rdquo;&nbsp;<i>― Evan and Nikayla, the bloggers behind&nbsp;</i><a href="https://budgetingcouple.com/budgeting/"><i>Budgeting Couple</i></a>

Set It And Forget It

&ldquo;Using an app like&nbsp;<a href="https://www.acorns.com/" rel="nofollow">Acorns</a>&nbsp;can take less than 10 minutes to set up and will continuously save (and actually invest) money every time you make a purchase. Acorns works by rounding up each transaction to the nearest dollar and investing the difference for you automatically. It&rsquo;s a simple and quick way to get a method of saving and investing money every single day in place.&rdquo; ―&nbsp;<i>Dustyn Ferguson, blogger at&nbsp;</i><a href="https://dimewilltell.com/"><i>Dime Will Tell</i></a>

This article originally appeared on HuffPost.