Do You Live in a High-Debt City?

New survey data shows that geography can be a liability when it comes to spending.

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In Pictures: Top 10 Cities With the Most Debt

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Is your city making you overspend? High housing prices, exorbitant living costs, and cultures of spending mean residents in some areas tend to rack up much more debt than others. Denver, Seattle, Dallas, and Phoenix rank among the most indebted cities, with average debt levels of $26,100 and higher, according to an analysis by the credit reporting agency Experian.

[In Pictures: Top 10 Cities With the Most Debt.]

"The decrease in home values has changed people's behavior," says Michele Raneri, senior director of analytics at Experian. Some people have had to use personal loans for items they haven't in the past, for example, while many consumers are trying to pay down their credit card debt.

The ability to successfully unload debt varies by location. In Detroit, where residents have been hit hard by layoffs in the auto industry, total debt, which includes credit cards, auto loans, and personal loans but excludes mortgages, increased 6 percent to about $25,000 between 2007 and 2010. In San Diego, on the other hand, residents reduced their overall debt load by 10 percent, bringing it down to an average of $23,822.

On average, debt has decreased since 2007 throughout the country. "It looks like people are getting a better handle on credit, and not overextending or maxing out … they're using credit more as a tool and more responsibly," says Raneri. Lenders have also been tightening their standards and lending less money, which also contributes to the lower debt levels.

Money comparison site Bundle.com found that location influences spending habits. In West Virginia, households spend an average of $24,517 a year (excluding rent and mortgage costs), while Connecticut residents spend an average of $57,331 a year. A closer look reveals that West Virginians spend only about $100 a month on clothing, and just $30 a month on hobbies. Connecticut households, on the other hand, spend almost $200 a month on clothes and more than $100 on hobbies.

[Visit the U.S. News Personal Finance site for more insight and money management tips.]

"Income is obviously a big driver [of spending habits] … By and large, people spend the money they have," says Janet Paskin, managing editor of Bundle.com. "But it's also probably true that there are different spending cultures … West Virginia is clearly one of those states where it's more modest," she adds. Connecticut, on the other hand, is home to some of the country's wealthiest residents.

While Paskin says it's hard to make statewide generalizations, some trends jump out: The 10 most frugal states are concentrated in the South, and include South Carolina, Alabama, Georgia, and Mississippi. States with the biggest spenders are primarily on the East and West coasts, and include Washington, D.C., Maryland, New York, and California.

Despite the tighter credit markets, Raneri says it's still possible to shop around for lower interest rates and lower fees. She also warns that some consumers inadvertently hurt their credit scores by canceling credit cards, which can increase their overall utilization rate since fewer cards means they have less credit available. "Sometimes they close cards to simplify their lives, but sometimes that makes it look like they're more utilized than they really are," she explains.

[For more money-saving tips, visit the U.S. News Alpha Consumer blog.]

Raneri also recommends paying bills on time, making use of automated ways to pay monthly bills, and checking your credit report once a year to see if it contains any mistakes. "It impacts your interest rate, so a good score can literally pay off for people," she adds.

Wonder how your own city stacks up? Here's a list of the top ten most indebted cities:

Denver

Seattle

Dallas

Phoenix

Atlanta

Portland, OR

Baltimore

Washington, DC

Houston

Philadelphia