The Most Fiscally Healthy States (2026)
Wyoming is the most fiscally healthy state in 2026 with a score of 79.4/100, followed by South Dakota (76.3), Tennessee (76.1), Alaska (74.2), and Texas (72.2). Scores combine tax burden, debt, pension funding, credit ratings, and reserves from BEA, Pew, and S&P data. Illinois ranks last at 21.9.
Key Takeaways
- 1Wyoming leads the nation in fiscal health with a score of 79.4, 3.1 points ahead of #2 South Dakota. The top 3 is rounded out by Tennessee at 76.1.
- 2The West dominates: 4 of the top 10 states are in the West. Wyoming, Alaska, Utah, Idaho lead the way for the region.
- 3The 57.5-point gap between #1 Wyoming and #50 Illinois is one of the widest spreads across all categories. The median state scores 59.2, meaning half of all states fall below this threshold.
- 4The bottom 5 — Connecticut, Kentucky, Hawaii, New Jersey, Illinois — span multiple regions with no single geographic cluster. Illinois ranks last at 21.9, highlighting that weak fiscal health performance is not limited to one part of the country.
- 5Despite ranking #1 in fiscal health, Wyoming sits at #16 overall — a notable divergence that shows category leadership doesn't always translate to top composite scores. This gap suggests Wyoming has room to improve in other areas to climb the overall rankings.
Related Analysis
Which States Have the Lowest Taxes in 2026? Tax Burden Ranked
Tax burden is a major relocation factor. The difference between living in a high-tax and low-tax state can be worth thousands of dollars a year — and with remote work erasing geographic constraints, more people are making that move. We ranked all 50 states on fiscal health using Tax Foundation data, covering income tax, property tax, sales tax, total burden, debt, reserves, pension funding, and credit ratings.
Read the full analysis →| Rank | State | Grade | Fiscal Health Score | Overall Score | Key Metrics | Region |
|---|---|---|---|---|---|---|
| 1 | Wyoming | A+ | 79.4 | 69.4 | $72,523 GDP/cap · $1,420 debt/cap · 77% pension · AAA | West |
| 2 | South Dakota | A+ | 76.3 | 81.8 | $64,792 GDP/cap · $2,340 debt/cap · 100% pension · AAA | Midwest |
| 3 | Tennessee | A+ | 76.1 | 46.8 | $61,193 GDP/cap · $1,630 debt/cap · 97% pension · AAA | South |
| 4 | Alaska | A+ | 74.2 | 42.1 | $76,415 GDP/cap · $4,890 debt/cap · 75% pension · AA | West |
| 5 | Texas | A+ | 72.2 | 45.8 | $68,820 GDP/cap · $1,850 debt/cap · 76% pension · AAA | South |
| 6 | North Carolina | A | 71.5 | 53.7 | $59,614 GDP/cap · $1,540 debt/cap · 95% pension · AAA | South |
| 7 | Utah | A | 71.4 | 79.3 | $62,444 GDP/cap · $2,180 debt/cap · 92% pension · AAA | West |
| 8 | Nebraska | A | 71.4 | 74.9 | $67,337 GDP/cap · $1,280 debt/cap · 87% pension · AAA | Midwest |
| 9 | Idaho | A | 71.0 | 70.7 | $50,766 GDP/cap · $1,580 debt/cap · 91% pension · AA+ | West |
| 10 | Florida | A | 70.2 | 52.8 | $60,655 GDP/cap · $1,960 debt/cap · 82% pension · AAA | South |
| 11 | North Dakota | B+ | 69.8 | 76.6 | $73,814 GDP/cap · $2,190 debt/cap · 70% pension · AA+ | Midwest |
| 12 | Georgia | B+ | 69.7 | 51.5 | $63,669 GDP/cap · $1,690 debt/cap · 77% pension · AAA | South |
| 13 | Delaware | B+ | 67.2 | 52.3 | $73,530 GDP/cap · $4,630 debt/cap · 87% pension · AAA | Northeast |
| 14 | Iowa | B+ | 66.0 | 69.5 | $64,764 GDP/cap · $2,650 debt/cap · 87% pension · AAA | Midwest |
| 15 | Missouri | B+ | 65.4 | 49.3 | $56,365 GDP/cap · $2,080 debt/cap · 80% pension · AAA | Midwest |
| 16 | Indiana | B+ | 65.3 | 50.7 | $59,218 GDP/cap · $2,340 debt/cap · 82% pension · AAA | Midwest |
| 17 | Washington | B+ | 64.3 | 61.4 | $89,989 GDP/cap · $3,650 debt/cap · 82% pension · AA+ | West |
| 18 | Wisconsin | B+ | 63.6 | 65.2 | $59,815 GDP/cap · $2,860 debt/cap · 100% pension · AA | Midwest |
| 19 | New Hampshire | B | 63.1 | 87.8 | $68,816 GDP/cap · $3,210 debt/cap · 65% pension · AA+ | Northeast |
| 20 | Virginia | B | 62.8 | 74.9 | $66,440 GDP/cap · $2,830 debt/cap · 80% pension · AAA | South |
Show all 50 states ▾Show fewer ▴
| 21 | New Mexico | B | 62.0 | 33.1 | $52,834 GDP/cap · $3,050 debt/cap · 68% pension · AA | West |
| 22 | Colorado | B | 60.4 | 66.2 | $75,024 GDP/cap · $3,120 debt/cap · 67% pension · AA+ | West |
| 23 | West Virginia | B | 60.1 | 34.4 | $42,065 GDP/cap · $2,480 debt/cap · 66% pension · AA- | South |
| 24 | Montana | B | 59.5 | 71.1 | $53,889 GDP/cap · $2,750 debt/cap · 73% pension · AA+ | West |
| 25 | Arizona | B | 59.4 | 44.7 | $58,823 GDP/cap · $2,190 debt/cap · 72% pension · AA | West |
| 26 | Minnesota | B | 59.2 | 76.7 | $71,279 GDP/cap · $3,460 debt/cap · 79% pension · AAA | Midwest |
| 27 | Oklahoma | C+ | 58.4 | 41.5 | $55,709 GDP/cap · $2,560 debt/cap · 72% pension · AA | South |
| 28 | Nevada | C+ | 57.6 | 40.3 | $58,723 GDP/cap · $2,410 debt/cap · 76% pension · AA | West |
| 29 | Maine | C+ | 57.0 | 77.3 | $54,630 GDP/cap · $2,870 debt/cap · 79% pension · AA | Northeast |
| 30 | Ohio | C+ | 56.6 | 49.1 | $58,499 GDP/cap · $2,980 debt/cap · 76% pension · AA+ | Midwest |
| 31 | Alabama | C+ | 56.4 | 38.9 | $51,087 GDP/cap · $2,456 debt/cap · 72% pension · AA | South |
| 32 | Michigan | C+ | 56.2 | 47.7 | $55,326 GDP/cap · $3,180 debt/cap · 68% pension · AA | Midwest |
| 33 | Arkansas | C+ | 56.2 | 30.9 | $48,298 GDP/cap · $1,820 debt/cap · 78% pension · AA | South |
| 34 | Oregon | C+ | 55.4 | 58.1 | $61,810 GDP/cap · $3,520 debt/cap · 85% pension · AA | West |
| 35 | Maryland | C | 55.0 | 67.7 | $68,357 GDP/cap · $4,350 debt/cap · 75% pension · AAA | Northeast |
| 36 | South Carolina | C | 54.4 | 44.0 | $50,515 GDP/cap · $2,120 debt/cap · 60% pension · AA+ | South |
| 37 | Kansas | C | 52.4 | 59.3 | $61,165 GDP/cap · $2,280 debt/cap · 72% pension · AA+ | Midwest |
| 38 | Vermont | C | 51.1 | 79.6 | $56,157 GDP/cap · $4,380 debt/cap · 68% pension · AA+ | Northeast |
| 39 | Massachusetts | C | 50.1 | 72.8 | $99,274 GDP/cap · $9,680 debt/cap · 63% pension · AA+ | Northeast |
| 40 | California | C | 47.5 | 42.9 | $88,370 GDP/cap · $4,180 debt/cap · 72% pension · AA- | West |
| 41 | Pennsylvania | C | 45.6 | 60.3 | $64,785 GDP/cap · $4,120 debt/cap · 62% pension · AA- | Northeast |
| 42 | New York | C | 44.5 | 58.4 | $102,027 GDP/cap · $8,130 debt/cap · 90% pension · AA | Northeast |
| 43 | Mississippi | D | 43.8 | 31.5 | $38,882 GDP/cap · $3,140 debt/cap · 60% pension · AA- | South |
| 44 | Louisiana | D | 43.1 | 25.9 | $57,458 GDP/cap · $3,890 debt/cap · 64% pension · AA- | South |
| 45 | Rhode Island | D | 43.0 | 69.8 | $62,367 GDP/cap · $5,240 debt/cap · 58% pension · AA | Northeast |
| 46 | Connecticut | D | 38.4 | 73.5 | $87,478 GDP/cap · $11,038 debt/cap · 52% pension · A+ | Northeast |
| 47 | Kentucky | D | 38.4 | 38.4 | $50,825 GDP/cap · $3,420 debt/cap · 47% pension · A | South |
| 48 | Hawaii | D | 36.5 | 63.2 | $62,039 GDP/cap · $6,580 debt/cap · 59% pension · AA+ | West |
| 49 | New Jersey | F | 33.2 | 65.9 | $73,820 GDP/cap · $8,340 debt/cap · 55% pension · A+ | Northeast |
| 50 | Illinois | F | 21.9 | 52.0 | $74,153 GDP/cap · $6,750 debt/cap · 45% pension · BBB+ | Midwest |
Top 10 States for Fiscal Health
Frequently Asked Questions
Which states are in the best fiscal health in 2026?
Wyoming ranks #1 for fiscal health in 2026 with a score of 79.4/100, followed by South Dakota (76.3) and Tennessee (76.1). Rankings combine eight metrics: tax burden, state debt per capita, rainy day fund reserves, pension funded ratio, credit rating, GDP per capita, budget surplus/deficit, and GDP growth. Wyoming excels through a combination of responsible debt management, adequate reserves, and sustainable revenue generation. Fiscal health isn't just about low taxes — it measures whether a state can maintain services and meet obligations without raising taxes or cutting programs.
Which states have the worst fiscal health?
The states with the weakest fiscal health in 2026 are Illinois (21.9/100), New Jersey (33.2), and Hawaii (36.5). Common factors include higher state debt per capita, underfunded pension systems, weaker credit ratings, and insufficient rainy day fund reserves. Illinois faces particular challenges with pension obligations and accumulated debt. Poor fiscal health can create a negative spiral — states with lower credit ratings pay more to borrow, which increases debt costs, which leaves less money for services, which can drive residents to leave, further eroding the tax base. Improving fiscal health typically requires both revenue management and spending discipline sustained over multiple budget cycles.
How is the fiscal health score calculated?
The fiscal score combines eight metrics: tax burden (15%), state debt per capita (15%, inverted), rainy day fund reserves as a percentage of spending (15%), pension funded ratio (15%), credit rating (15%), GDP per capita (10%), budget surplus/deficit (10%), and GDP growth rate (5%). Data sources include the Bureau of Economic Analysis (GDP), Census Bureau State Government Finances (FY2022), Pew Charitable Trusts Fiscal 50 and Pension data, NASBO fiscal surveys, S&P/Moody's credit ratings (2025), and Tax Foundation tax burden estimates. Fiscal health carries an 8% weight in the composite score. This multi-metric approach ensures states aren't rewarded just for low taxes while carrying unsustainable debt or pension liabilities.
Is a low tax burden the same as good fiscal health?
No. A state with very low taxes but crushing debt, unfunded pension obligations, and a weak credit rating is not truly in good fiscal shape. Our fiscal health score captures the full picture: can a state meet its current and future obligations without raising taxes or cutting services? Some low-tax states fund themselves through natural resource revenue (oil, gas, minerals) which fluctuates with commodity prices. Other low-tax states have accumulated significant debt or deferred pension payments. Conversely, some higher-tax states are in excellent fiscal health because their revenue covers obligations with surplus. The best fiscal position combines manageable tax rates with low debt, funded pensions, healthy reserves, and a strong credit rating.
Why do pension obligations matter for state fiscal health?
State pension systems represent trillions of dollars in commitments to current and retired public employees — teachers, police, firefighters, and government workers. When pension funds are underfunded, the state eventually must make up the shortfall through higher taxes, reduced services, or more borrowing. Some states have pension funded ratios well below 60%, meaning they've promised far more than they've set aside. This creates a long-term fiscal drag that limits flexibility to respond to recessions, invest in infrastructure, or keep taxes competitive. Our fiscal score weights pension funding at 15% because it represents one of the largest and most persistent fiscal risks states face, often taking decades to correct once it falls behind.
How the Fiscal Health Score Is Calculated
Our expanded fiscal score combines tax burden (15%), state debt per capita (15%), rainy day fund reserves (15%), pension funded ratio (15%), credit rating (15%), GDP per capita (10%), budget surplus/deficit (10%), and GDP growth rate (5%). Data comes from the BEA, Census Bureau State Government Finances, Pew Charitable Trusts, NASBO, S&P/Moody's, and the Tax Foundation. Fiscal health carries an 8% weight in the composite score. States with balanced budgets, low debt, funded pensions, and strong credit ratings score highest — even if their tax rates aren't the lowest.