Many people are struggling as inflation continues to strain household budgets and make it harder for Americans to keep up with loan and credit payments.
Although the economy is growing slowly, layoffs continue. In addition, tariffs and immigration policy continue make consumers uncertain about what’s going to happen next. In January, consumer sentiment fell to its lowest level since 2014, according to a survey by The Conference Board.
To look at where financial pressure is hitting residents the hardest across the country, WalletHub, a personal finance website, has released its latest report on the “Cities with the Most People in Financial Distress.”
To compile the rankings, WalletHub evaluated the 100 largest cities without data limitations across nine key metrics. These factors include average credit scores, changes in bankruptcy filings from September 2024 to September 2025, and the share of residents with accounts in distress.
| Most Distressed | Least Distressed |
| 1. Chicago | 91. Scottsdale, Ariz. |
| 2. Houston | 92. Honolulu |
| 3. Las Vegas | 93. Des Moines, Iowa |
| 4. Dallas | 94. Spokane, Wash. |
| 5. Los Angeles | 95. Jersey City |
| 6. San Antonio | 96. Pittsburgh |
| 7. Atlanta | 97. Lincoln, Neb. |
| 8. New York | 98. Boise, Idaho |
| 9. Austin | 99. Winston-Salem, N.C. |
| 10. Phoenix | 100. Anchorage |
“Getting out of the downward spiral of financial distress is no easy feat,” Chip Lupo, analyst for WalletHub, said. “You may get temporary relief from your lenders by not having to make payments, but all the while interest will keep building up, making the debt even harder to pay off.”
Lupo said people who find themselves in financial distress should budget carefully, cut non-essential expenses, and pursue strategies such as debt consolidation or debt management to get their situation under control.
Chicago
Chicago ranks first in terms of financial distress in the report, in part because it had the biggest change in the share of people who had accounts in distress between the third quarter of 2024 and the third quarter of 2025, with nearly a 30 percent increase. This represents a nearly 30 percent year-over-year increase in residents permitted to skip payments due to financial difficulty. In addition, Chicago residents had the third-most accounts in distress per person.
Houston
Houston, the city with the second-highest level of financial distress, has a high share of the population with accounts in distress compared to most other cities, at more than 8 percent. It also has a high number of accounts in distress per person.
Las Vegas
Las Vegas has the third-most financially distressed residents in the country. More than 9 percent of its residents are having accounts in distress, the eighth-highest percentage in the nation, along with the ninth-highest number of distressed accounts per person.
If you’re having debt problems, there are ways to turn your financial life around. Tuesday’s article will address “How to Get Out of Debt.”
