America's Thriftiest Cities

For many Americans, instant gratification has taken a backseat to long-term financial security. In May 2009, the U.S. personal income savings rate increased to 6.9 percent from 0 percent a year earlier. This is the highest level since December 1993, according to the Commerce Department.

Given the recession, it's understandable that Americans are hording more cash by spending less. Some, though, are doing a better job than others.

Consider San Jose, Calif., and Detroit, Mich. Both metros suffer from a high unemployment rate; San Jose's is 11.2 percent, and Detroit's inching up to 14.9 percent in May 2009, according to the Bureau of Labor Statistics. The median income in San Jose is $82,208; in Detroit, it's $42,809. But in both the credit card debt-to-household-income ratio is relatively low. In San Jose, the average household owes 11.46 percent of its income to credit-card companies. In Detroit, that household needs to pay back 13.02 percent.

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Both have less credit card debt relative to income than those living in places like Miami--indebted by an average of 22.61 percent--and Los Angeles, with an average debt-to-income ratio of 16.81 percent.

At 11.43 percent, Washington, D.C., boasts the lowest household credit card debt-to-income ratio. One reason? Government jobs attract those who are conservative about personal finances, suggests Alice M. Rivlin, an economist at Brookings, a Washington, D.C.-based independent research firm. What's more, this is a relatively prosperous metro area with a low unemployment rate of 6.2 percent (the national average is 9.5 percent). The District of Columbia also has high concentrations at the top and bottom of the income distribution spectrum--with 20 percent of residents below the poverty level--and a smaller middle class.

Other cities topping the list include Nashville, Tenn., Boston and Kansas City, Mo., all with credit card debt-to-income ratios below 12.1 percent.

Behind the Numbers

To determine where Americans are most frugal, we turned to Atlanta, Ga.-based Equifax, one of the three largest consumer credit reporting agencies in the country. From its database, Equifax determined total credit card debt in each of the 50 largest metropolitan statistical areas and metropolitan divisions from the first quarter of 2009. MSAs are geographic entities defined by the U.S. Office of Management and Budget and used by federal agencies in collecting, tabulating and publishing federal statistics. We found the average credit card debt per household by dividing the number of households in each metro area by the overall debt of the area.

Finally, we divided each metro area's average debt per household by May 2009 median household income, determined by Moody's, an independent provider of economic analysis and data. This last calculation gave the average percent of household income owed to credit card companies in each place.

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