What if borrowers could turn the stressors of financial stability into one of their greatest strengths? According to a recent report, they can—depending on the location they choose to call home.
According to WalletHub’s 2017 Best and Worst Cities for Wallet Fitness, making financially sound decisions—like saving up for a down payment on a home—is easier if a buyer considers a market with high media credit scores, low foreclosure rates, and low non-mortgage debt.
In order to determine the best cities for financial strength, or “wallet fitness” WalletHub’s analysts compared 182 cities across five key dimensions, including credit standing, responsible spending, savings, risk exposure, and earning power.
These dimensions are then evaluated using 29 relevant metrics, with each metric graded on a 100-point scale, with a score of 100 representing the most favorable conditions for achieving top wallet fitness.
Which city earned the No. 1 spot? With the highest median credit score in the entire ranking—along with the lowest non-mortgage related debt, Fremont, California earns the title of the city with the best wallet fitness.
Following suit is another California city that might come as a surprise. But with one of the highest media credit scores and lowest non-mortgage debt, it makes sense that San Francisco would rank No. 2.
Ranking in the top for credit standing and responsible spending, Madison, Wisconsin takes the third spot for wallet fitness. Rounding out the top five are Columbia, Maryland—which has the highest median household income—and San Jose, California, as one of the cities with lowest non-mortgage debt.
Completing the top 10 financially strong cities for homebuyers are Seattle, Washington, Minneapolis, Minnesota, Sioux Falls, South Dakota, Bismarck, North Dakota, Warwick, Rhode Island, respectively.
WalletHub expert Ann Holmes, Assistant Dean for Finance and Administration for the College of Behavioral and Social Sciences at the University of Maryland expressed how in the end, financial stability is self-controlled no matter where one chooses to live. However, sometimes relocation is key.
“Living within your means is the key no matter where you live,” Holmes said. “That said, I know that some locations will never have the same opportunities for good-paying jobs. It’s a tale as old as time. Sometimes, moving is the only way to stay afloat.”
To view the full report, click here.