Credit card debt in the United States has reached a record $1.28 trillion, according to new data from the Federal Reserve Bank of New York. The increase reflects rising borrowing as Americans face higher living costs, inflation, and financial pressures.
According to CNBC, credit card balances continue to climb nationwide. Experts say the growing debt signals broader economic stress and highlights financial challenges faced by young adults and college students.
Students at Florida A&M University say the rising cost of everyday necessities has made financial management is more difficult.
Rising Costs and Financial Pressure
For many students, credit cards are both a financial tool and a potential risk.
Kesean Brown, a fourth-year social work major at Florida A&M University, said he got his first credit card in 2021 shortly after graduating from high school.
Brown said his goal was to begin building credit early while learning how to manage expenses.
However, he says everyday costs have increased dramatically since he started college.
“Food, gas and even normal daily stuff seem to add up really fast,” Brown said. “It’s made me a lot more aware of budgeting and planning ahead because every dollar counts.”
Brown said he tries to pay off his credit card balance each month to avoid interest charges. Even then, he said the financial pressures of school, jobs and personal expenses can be overwhelming.
“College students today probably feel more financial pressure than students in the past,” Brown said. “Housing, gas, food and tuition are all going up.”
Learning Credit the Hard Way
Other students say they have experienced firsthand how credit cards can quickly lead to debt.
Iyore Iyamu, a student who has had a credit card since age 18, said managing credit can be challenging without financial education.
“I think it’s great because you’re building your credit,” Iyore Iyamu said. “But if you never took financial literacy classes, some people don’t manage their money correctly and they can find themselves in debt faster.”
Iyamu said interest charges are one of the biggest challenges with credit cards.
“Every time I pay the minimum, they add interest,” Iyamu also said. “Sometimes it’s $10 or $15 dollars, and it just keeps pushing my credit up.”
Iyamu said hearing about the national credit card debt total was shocking.
“I think it’s insane when you really think about it,” Iyamu said. “A lot of people rely on credit cards because of inflation or losing jobs.”
“That is not free money. You owe that back,” Iyamu also said.
Iyamu also said young adults should be cautious when opening their first credit card.
“Don’t get a credit card until you have a job,” Iyamu said. “Make sure you know how to manage your finances.”
Lack of Financial Education
Some experts believe financial education plays a major role in rising credit card debt.
Reggie Grant, a journalism professor at Florida A&M University, said many young adults are not taught financial management early enough.
“I think that financial management is not something that’s necessarily taught in high school.” Grant said.
Without that foundation, he said students may struggle when they begin using credit.
“One of the easiest things to do is get a credit card,” Grant said. “Then you start running it up and before you know it you’re thousands of dollars in debt.”
Grant said students should consider starting with secured credit cards to avoid overspending.
With secured cards, users deposit a set amount of money, often around $300, which becomes their spending limit.“That helps you budget and keeps you from getting in over your head,” Grant said.
Advice for First-Time Credit Card Users
Financial experts and students agree that responsible credit use starts with understanding spending habits and budgeting.
Brown said careful planning helps him maintain control of his finances while still having some flexibility.
“I try to keep an eye on how much I’m spending so I don’t get too far into it,” Brown said.
Grant said conversations about financial responsibility are just as important as access to credit.
“Understanding your wants versus your needs is very important,” Grant said.
As credit card balances continue rising nationwide, experts say financial literacy may be key to helping younger generations avoid long-term debt.
Tips for Managing Your First Credit Card
• Pay more than the minimum balance each month
• Avoid using credit for unnecessary purchases
• Track spending and create a monthly budget
• Consider starting with a secured credit card
• Learn how interest rates and fees work
