Kentucky Among Top States Facing Financial Trouble in 2025

Kentucky is facing serious financial challenges, ranking ninth in the nation for the highest number of people in financial distress, according to a new report from WalletHub. According to this study, many Americans are struggling to keep up, especially in the Commonwealth.

DebtcanvaKY

Across the U.S., 8.8 million people are behind on at least one credit account or have had their payments paused. In Kentucky, the situation is especially tough, with credit scores among the lowest in the country and a growing number of people falling behind on multiple accounts. Many of our neighbors are struggling.

Kentucky Households Face Increasing Financial Strain

Kentucky ranks 9th in the nation for financial distress, with several key indicators pointing to rising financial struggles across the state. As of March 2025, the state has the 6th lowest average credit score, reflecting widespread difficulty managing debt. Between the first quarter of 2024 and the first quarter of 2025, Kentucky saw the 11th largest increase in the share of people with accounts in distress, and the 6th highest jump in the average number of distressed accounts per person. On top of that, Kentucky ranks 10th for online searches related to loans, with many residents actively seeking financial help or new sources of credit.

Get our free mobile app

6th – Average Credit Score (March 2025)
11th – Change in the Share of People with Accounts in Distress - Q1 2025 vs. Q1 2024
6th – Change in the Average Number of Accounts in Distress - Q1 2025 vs. Q1 2024
10th – “Loans” Search Interest Index

How WalletHub Measured Financial Distress Across the States

To determine which states are experiencing the most financial distress, WalletHub compared all 50 states across nine key metrics. The data includes factors such as the average credit score, the change in the number of bankruptcy filings between March 2024 and March 2025, and the share of people with accounts in distress. These indicators help measure how well, or poorly, residents manage their finances over time.

“Measuring the share of residents in financial distress is a good way to take the pulse of a state and see whether people are generally thriving or having trouble making ends meet. 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.” - Chip Lupo, WalletHub Analyst

Main Findings

Source: WalletHub