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NASHVILLE – Tennesseans hold more than $50,000 in debt on average and have higher rates of distressed debt relative to the nation as a whole, finds a new policy brief released today from nonpartisan think tank ThinkTennessee. The brief includes an overview of the levels and types of debt owed by Tennesseans, specific rates and causes for delinquent debt, the impacts of delinquent debt on Tennesseans’ financial, economic, and physical health, and recommendations for Tennessee policymakers.

“Almost all Americans take on debt during their lifetime, but not all forms of debt are damaging to their financial health,” said Erin Hafkenschiel, President of ThinkTennessee. “Debt can help people to become homeowners, attend college, purchase vehicles, and start new businesses. But when debt payments are high compared to one’s earnings, it can lead to delinquencies, collections, and bankruptcy, harming both people’s lives and the economy’s long-term health.”

According to the brief, while Tennessee’s per capita household debt ($51,160) is lower than the national average ($59,580), the state exceeds the national average for debt that is in collections (32% compared to 26%). The difference is even more stark among communities of color, which has a debt-in-collections rate of 47%. Tennessee has many characteristics that increase the likelihood of high levels of debt and delinquencies, including low incomes, high rates of unbanked households, high rates of cost-burdened households, and high rates of uninsured people. The high rates of debt and delinquencies are harming Tennessee families through long-term detrimental financial consequences and negative health impacts. If not appropriately addressed, high levels of individual distressed debt could result in reduced economic growth.

The report highlights several policy levers that could be used to address the high rate of distressed debt in Tennessee, including enhanced consumer protections, financial education, improvements to non-auto transportation, expanded Medicaid, more affordable housing, and better data collection.

To read the full report, Tennesseans Hold Too Much Distressed Debt, visit

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