Is Your State Financially Distressed? (2026)
Nevada ranks highest on the State Distress Index at 85.4 as of June 2026, with 20 of 51 jurisdictions in the two most distressed fifths. Four-domain composite built from NY Fed, BLS, USDA, and U.S. Courts data; scores range from 9.0 (New Hampshire) to 85.4.
Which States Have the Most Financial Distress?
Nevada has the highest State Distress Index score at 85.4, followed by Louisiana (84.5), District of Columbia (75.9), New Mexico (73.9), and Oklahoma (73.8). These five jurisdictions share elevated delinquency rates across credit cards, auto loans, and mortgages. The remaining composition varies meaningfully across the four SDI domains: delinquency, default and legal, labor, and safety-net buffer. The composite score points the same direction; the channel through which the score accumulates is not the same across these states. The per-state domain breakdown is published with the interactive state map.
At the other end, New Hampshire (9.0), North Dakota (12.1), and South Dakota (15.5) show the least distress. A 76.4-point gap. Same federal interest rates. Same inflation. Same labor market cycle. The gap is not about the economy getting worse — it is about the economy getting worse in specific places for specific structural reasons. American Default Research publishes the American Distress Index nationally and the State Distress Index for geography, scoring all 51 jurisdictions across four domains of household financial distress.
At a Glance
The national American Distress Index currently reads 44.6 (Typical). On average, its inputs sit higher than in 45% of their own quarterly histories since 2005. The national ADI tracks distress over time, ranking each input against its own quarterly history. The State Distress Index compares states to each other at a single point in time, revealing where household distress is concentrating geographically. See the interactive state map for a visual overview, or compare individual state foreclosure timelines alongside their distress scores.
All 51 Jurisdictions Ranked
State Distress Index scores for every state and DC, ranked from highest distress to lowest. Colors group states by distress quintile; rank #1 is the most distressed jurisdiction.
State Distress Index Scores — All 51 Jurisdictions
State Distress Index composite
What Is Driving the Highest Distress Scores?
Two states can have similar composite scores but arrive there through different mechanisms. One state can score high because of debt performance. Another because of the labor domain or safety-net buffer. The domain breakdown for the top 10 most distressed states shows where each score comes from.
Domain Breakdown — Top 10 Most Distressed States
Domains: Delinquency, Default & Legal, Labor, Safety Net & Buffer
How Many States Are in Each Distress Quintile?
The State Distress Index is cross-sectional. A middle-fifth state is not being labeled healthy or unhealthy; it is being placed in the middle of the current state distribution. Given that the national ADI reads 44.6, even a median-ranked state may have indicators that look distressed in isolation. Relative positioning and absolute distress are different questions.
Which Regions Have the Most Financial Distress?
Financial distress clusters geographically, which makes sense when you think about the structural factors. The South leads with an average State Distress Index of 65.0 — 11 of 14 states in the two most distressed fifths. The Midwest averages 39.9. These are not random clusters. The South combines weaker safety net programs, lower median wages, higher credit card delinquency, and faster population growth in states with thinner household financial buffers. Read the regional average as a policy outcome. Every input on that list traces back to a legislative choice made decades ago, compounded year over year. For a deeper analysis — including the Deep South and Sun Belt corridors — see the State Distress Rankings page.
Average State Distress Index by Region
Regions use Census Bureau definitions · DC included in Northeast
| Region | States | Avg Score | Top Two Fifths | Most Distressed |
|---|---|---|---|---|
| South | 14 | 65.0 | 11 | Louisiana (84.5) |
| Northeast | 12 | 48.4 | 2 | District of Columbia (75.9) |
| West | 13 | 44.6 | 4 | Nevada (85.4) |
| Midwest | 12 | 39.9 | 3 | Michigan (72.2) |
Which States Score Highest on Each Domain?
Different states struggle on different dimensions. Below are the five highest-scoring states on each State Distress Index domain. A state ranking high on multiple domains suggests broad-based systemic distress; one ranking high on a single domain may have a specific, identifiable vulnerability.
Delinquency
Credit card, auto, mortgage delinquency
| State | Score |
|---|---|
| Mississippi | 97.7 |
| Louisiana | 95.8 |
| District of Columbia | 93.8 |
| Georgia | 91.2 |
| Alabama | 88.6 |
Default & Legal
Collections and bankruptcy filings
| State | Score |
|---|---|
| Alabama | 96.1 |
| Georgia | 93.1 |
| Louisiana | 89.2 |
| Mississippi | 89.2 |
| Nevada | 88.2 |
Labor
State unemployment rate
| State | Score |
|---|---|
| District of Columbia | 99.0 |
| Delaware | 97.1 |
| California | 95.1 |
| Nevada | 93.1 |
| Oregon | 91.2 |
Safety Net & Buffer
SNAP enrollment
| State | Score |
|---|---|
| New Mexico | 99.0 |
| District of Columbia | 97.1 |
| Oregon | 95.1 |
| Louisiana | 93.1 |
| Oklahoma | 91.2 |
The Geographic Default Pattern
Two corridors of elevated distress emerge from the data. The Deep South corridor — Mississippi, Louisiana, Alabama, Georgia — combines high delinquency rates with high SNAP enrollment and weak safety nets. The Sun Belt corridor — Nevada, Florida, Arizona — shows distress driven by debt stress and rapid population growth that outpaced financial resilience. The least distressed fifth shares a different profile: low delinquency, stronger buffers, and above-average labor markets. Per-state domain breakdowns are on the interactive state map.
Read more: The Two-Economy Problem →Full State Rankings
All 51 jurisdictions with composite score, rank, quintile, and four domain scores. Click a state name to see its full distress profile, indicator data, and foreclosure law summary.
| Rank | State | Score | Quintile | Delinq. | Default | Labor | Buffer |
|---|---|---|---|---|---|---|---|
| 1 | Nevada | 85.4 | Most distressed fifth | 86.6 | 88.2 | 93.1 | 73.5 |
| 2 | Louisiana | 84.5 | Most distressed fifth | 95.8 | 89.2 | 59.8 | 93.1 |
| 3 | District of Columbia | 75.9 | Most distressed fifth | 93.8 | 13.7 | 99.0 | 97.1 |
| 4 | New Mexico | 73.9 | Most distressed fifth | 74.2 | 45.1 | 77.5 | 99.0 |
| 5 | Oklahoma | 73.8 | Most distressed fifth | 79.4 | 78.4 | 46.1 | 91.2 |
| 6 | Delaware | 72.7 | Most distressed fifth | 70.3 | 75.5 | 97.1 | 48.0 |
| 7 | Michigan | 72.2 | Most distressed fifth | 52.6 | 65.7 | 85.3 | 85.3 |
| 8 | Illinois | 70.9 | Most distressed fifth | 55.2 | 57.8 | 87.3 | 83.3 |
| 9 | West Virginia | 70.4 | Most distressed fifth | 74.8 | 53.9 | 63.7 | 89.2 |
| 10 | Mississippi | 70.3 | Most distressed fifth | 97.7 | 89.2 | 34.3 | 59.8 |
| 11 | Georgia | 69.1 | Second-most distressed fifth | 91.2 | 93.1 | 22.6 | 69.6 |
| 12 | Kentucky | 69.0 | Second-most distressed fifth | 65.0 | 87.3 | 52.0 | 71.6 |
| 13 | Alabama | 68.7 | Second-most distressed fifth | 88.6 | 96.1 | 8.8 | 81.4 |
| 14 | Florida | 67.4 | Second-most distressed fifth | 77.5 | 66.7 | 72.5 | 52.9 |
| 15 | South Carolina | 65.6 | Second-most distressed fifth | 86.0 | 56.9 | 81.4 | 38.2 |
| 16 | Oregon | 65.2 | Second-most distressed fifth | 27.4 | 47.1 | 91.2 | 95.1 |
| 17 | Texas | 64.8 | Second-most distressed fifth | 88.6 | 70.6 | 53.9 | 46.1 |
| 18 | California | 63.4 | Second-most distressed fifth | 44.8 | 38.2 | 95.1 | 75.5 |
| 19 | Ohio | 60.8 | Second-most distressed fifth | 57.8 | 71.6 | 48.0 | 65.7 |
| 20 | Arkansas | 60.2 | Second-most distressed fifth | 80.1 | 85.3 | 56.9 | 18.6 |
| 21 | Maryland | 59.7 | Middle fifth | 68.3 | 63.7 | 56.9 | 50.0 |
| 21 | New York | 59.7 | Middle fifth | 62.4 | 23.5 | 65.7 | 87.3 |
| 23 | Pennsylvania | 57.8 | Middle fifth | 58.5 | 43.1 | 50.0 | 79.4 |
| 24 | Tennessee | 53.8 | Middle fifth | 67.0 | 87.3 | 28.4 | 32.4 |
| 25 | Rhode Island | 52.3 | Middle fifth | 43.5 | 30.4 | 67.7 | 67.7 |
| 26 | North Carolina | 52.1 | Middle fifth | 72.2 | 46.1 | 32.4 | 57.8 |
| 27 | Missouri | 51.1 | Middle fifth | 54.6 | 65.7 | 40.2 | 44.1 |
| 28 | New Jersey | 50.7 | Middle fifth | 48.7 | 40.2 | 83.3 | 30.4 |
| 29 | Arizona | 49.5 | Middle fifth | 59.8 | 59.8 | 69.6 | 8.8 |
| 30 | Connecticut | 49.4 | Middle fifth | 48.7 | 35.3 | 79.4 | 34.3 |
| 31 | Washington | 47.1 | Middle fifth | 16.7 | 29.4 | 89.2 | 52.9 |
| 32 | Massachusetts | 45.5 | Second-least distressed fifth | 21.2 | 7.8 | 75.5 | 77.5 |
| 33 | Indiana | 44.2 | Second-least distressed fifth | 63.1 | 74.5 | 16.7 | 22.6 |
| 34 | Virginia | 40.9 | Second-least distressed fifth | 44.1 | 53.9 | 37.3 | 28.4 |
| 35 | Alaska | 38.4 | Second-least distressed fifth | 21.2 | 23.5 | 72.5 | 36.3 |
| 36 | Colorado | 38.2 | Second-least distressed fifth | 33.0 | 34.3 | 43.1 | 42.2 |
| 37 | Kansas | 36.8 | Second-least distressed fifth | 42.2 | 54.9 | 43.1 | 6.9 |
| 38 | Wisconsin | 33.7 | Second-least distressed fifth | 8.2 | 44.1 | 20.6 | 61.8 |
| 39 | Minnesota | 30.5 | Second-least distressed fifth | 8.2 | 31.4 | 61.8 | 20.6 |
| 40 | Maine | 29.9 | Second-least distressed fifth | 22.6 | 26.5 | 14.7 | 55.9 |
| 41 | Iowa | 29.5 | Second-least distressed fifth | 31.7 | 42.2 | 18.6 | 25.5 |
| 42 | Hawaii | 26.0 | Least distressed fifth | 26.5 | 10.8 | 2.9 | 63.7 |
| 43 | Idaho | 24.9 | Least distressed fifth | 19.3 | 39.2 | 30.4 | 10.8 |
| 44 | Utah | 24.4 | Least distressed fifth | 3.6 | 53.9 | 37.3 | 2.9 |
| 45 | Wyoming | 23.3 | Least distressed fifth | 24.5 | 42.2 | 25.5 | 1.0 |
| 46 | Nebraska | 22.0 | Least distressed fifth | 19.3 | 41.2 | 10.8 | 16.7 |
| 47 | Montana | 20.3 | Least distressed fifth | 16.7 | 26.5 | 25.5 | 12.8 |
| 48 | Vermont | 17.6 | Least distressed fifth | 15.7 | 7.8 | 6.9 | 40.2 |
| 49 | South Dakota | 15.5 | Least distressed fifth | 23.9 | 11.8 | 1.0 | 25.5 |
| 50 | North Dakota | 12.1 | Least distressed fifth | 10.1 | 18.6 | 4.9 | 14.7 |
| 51 | New Hampshire | 9.0 | Least distressed fifth | 7.5 | 10.8 | 12.8 | 4.9 |
Frequently Asked Questions
Which state has the highest financial distress?
Nevada has the highest State Distress Index score at 85.4, ranking #1 of 51 jurisdictions and sitting in the most distressed fifth. Louisiana (84.5) and District of Columbia (75.9) round out the top three.
Which state has the lowest financial distress?
New Hampshire has the lowest State Distress Index score at 9.0, ranking #51 of 51 jurisdictions and sitting in the least distressed fifth.
How is the State Distress Index calculated?
The State Distress Index is the mean of four equal-weighted domains: delinquency, default and legal, labor, and safety-net buffer. Each domain is built from state-level input percentile ranks, with higher values indicating more distress. Data sources include the NY Fed, BLS, USDA, and U.S. Courts.
How does the State Distress Index differ from the national ADI?
The national ADI ranks each of its inputs against that input's own quarterly history — it tracks how the present compares with the nation's own past. The State Distress Index compares states to each other at a point in time. The national ADI currently reads 44.6 (Typical). On average, its inputs sit higher than in 45% of their own quarterly histories since 2005. State scores range from 9.0 to 85.4.
Which region has the highest average financial distress?
The South has the highest average State Distress Index score at 65.0, with 11 of 14 states in the two most distressed fifths. Louisiana (84.5) is the most distressed state in the region. The Midwest averages 39.9.
Data Sources
NY Fed Consumer Credit Panel
State-level credit card, auto loan, and mortgage delinquency rates. Quarterly data from a nationally representative 5% sample of Equifax credit reports.
BLS, USDA, U.S. Courts
State unemployment rates (LAUS), SNAP enrollment (FNS), and bankruptcy filings per 100K (Administrative Office). Updated monthly or annually.
CFPB, State Statutes, KFF
Mortgage complaint density per 100K, foreclosure legal protections scoring, Medicaid enrollment rates, and HAF program status. Multiple federal and state sources.