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Credit card balances rise and credit scores drop nationwide, leaving some Gen Z students in more financial trouble. Graphic by Dante Estrada | Long Beach Current<\/p>\n
U.S. credit card balances reached $1.23 trillion in the third quarter of 2025, according to the Federal Reserve Bank of New York<\/a>, up $20 billion from the $1.21 trillion reported in Q2 2025.<\/a><\/p>\n In May 2024, the Federal Reserve Bank of New York<\/a> reported that Generation Z borrowers had a higher share of their credit cards highly utilized than other generations. Compared with 12.3% of millennials \u2014 the second-highest rate \u201415.1% of Gen Z borrowers were maxed out.<\/p>\n Heather Summers, chief marketing officer at LBS Financial<\/a>, oversees the credit union\u2019s marketing and business development teams as well as its government relations and data analytics.<\/p>\n LBS Financial Credit Union is a community credit union that serves people on and off campus. It operates a branch at Long Beach State\u2019s Beach Shops on the second floor of the University Bookstore, where students can open accounts and use an ATM for deposits and withdrawals.\u00a0<\/p>\n LBS Financial offers loans and credit cards, along with online and mobile banking services for everyday account access.\u00a0LBS Financial also runs a scholarship program that eligible students can apply for.\u00a0<\/p>\n Additionally, the Beach Shops branch also offers 0% technology loans to CSULB students, faculty and staff.<\/p>\n Summers said she has noticed students opening credit accounts earlier than they used to, attributing the shift to earlier access to money, with cash becoming less common.<\/p>\n Summers said students most often come into LBS with questions about how to build credit. <\/p>\n \u201cMany financial institutions offer starter products to get students in the door and help them establish a track record, and students really just want to get their foot in the door, too, so they can take out an auto loan with low interest rates or even a home loan,\u201d Summers said.<\/p>\n While many students may be eager to build credit, the national average FICO credit score fell to 715 in April 2025, which is a point drop from January and a two-point drop from April 2024, according to FICO<\/a>. <\/p>\n FICO attributed the decline largely to federal student loan delinquencies, which were again reported on credit files as of February 2025.\u00a0<\/p>\n A survey conducted by the California Student Aid Commission<\/a> in the 2018-2019 academic year reported that 60% of college students have at least one credit card. <\/p>\n Among students with a credit card, 77% use it to pay for education and living costs, and 70% reported they couldn\u2019t afford those expenses otherwise.<\/p>\n \u201cThe biggest mistake students make is overextending themselves using credit cards to live beyond your means, and not paying back your credit cards at the end of the month,\u201d Summers said. <\/p>\n She added that some students are drawn to rewards cards without fully weighing the bigger picture, including interest rates, fees and whether they can realistically pay the balance in full.\u00a0<\/p>\n Summers also said she has seen an increase in credit-related scams targeting students, including check-cashing schemes. <\/p>\n In those cases, she said, students are told to deposit a check and return a portion of the money, only to learn later that the check was fraudulent, leaving them responsible to pay the full amount.<\/p>\n Summers encourages students to ask questions about these topics to make sure they are financially safe.<\/p>\n Jayden Sandstrom is a junior at California State University, Long Beach, majoring in business finance and management. This is his first year with the Long Beach Current, where he serves as a news assistant. Outside of the Long Beach Current, Jayden works part time at a restaurant and is involved with ASI and the University Honors Student Association. After graduation, he plans to attend law school and pursue a career in either entertainment law or corporate law.<\/p>\n![\"Jayden](\"https:\/\/www.newsbeep.com\/us-ca\/wp-content\/uploads\/2026\/01\/1768928413_97_bbc4d4d7291e869e85bb7ab6b946bee09fc29a2f6c5c578d645dd1e2da9cd7d7.jpeg\")
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