Texas #1 financially distressed US state, followed by Florida, and Louisiana

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“Around 11.8% of Louisianians also have a credit account in forbearance or with deferred payments, the highest share in the country,” according to WalletHub.

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With prices rising on everything from groceries to rent amid a backdrop of economic uncertainty, many Americans are struggling to pay the bills.

They’re even turning to credit to pay for essentials. A recent LendingTree survey found that one-quarter (25%) of buy-now-pay-later users have used these loans to buy groceries.

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But some states are struggling more than others. Florida is now one of the most financially stressed states in the country, second only to another Southern state, according to a new report by WalletHub, which defines financial distress as having credit in forbearance or deferring payments due to financial difficulty.

“When you combine data about people delaying payments with other metrics like bankruptcy filings and credit score changes, it paints a good picture of the overall economic trends of a state,” WalletHub analyst Chip Lupo said about the findings.

Here are the five states struggling the most and why people there are having such a tough time.

The top 5 financially distressed states
Texas is the most financially distressed state in the country, followed by Florida, Louisiana, Nevada and South Carolina. The states that are best off? That honor goes to Hawaii, followed by Vermont, Alaska, Oregon and New Mexico.

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To determine their ranking, WalletHub compared all 50 states across nine key metrics in six categories, calculating an overall score by weighting the average across all metrics. For example, the ‘credit score’ category is determined by two key metrics: the average credit score as of March earned double weight, while the change in credit score from March 2024 to March 2025 earned full weight.

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Once all the numbers were crunched, Texas came out on top — and, in this case, No. 1 means the most distressed or worst off — even though the state has a larger GDP than most countries (ranking ninth on the world stage). And it still has one of the top 10 economies in the U.S.

Texans search Google for ‘debt’ and ‘loans’ at a high rate, “which shows that many people are desperate to borrow, despite already owing money,” says the WalletHub report. They also ranked sixth in the change in number of bankruptcy filings from March 2024 to March 2025, with non-business bankruptcy filings increasing more than 22% in the past year.

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