Gen Z is opening credit card accounts at higher rates than any other generation, according to a new report from credit scorer FICO.
More than 25% of Gen Z adults between 18 and 29 with a FICO Score opened at least one credit card in the past year — the highest rate of any age group, according to the data.
What’s behind the plastic grab? Bills to pay.
“When faced with job loss or income reduction over the past 12 months, 48% of Gen Z and 43% of millennials relied on credit cards to make ends meet, compared to 25% of Gen X and just 7% of baby boomers,” according to FICO vice president Jenelle Dito.
All told, nearly 4 in 10 Gen Zers said they’re opening cards to have a financial cushion.
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This dovetails with the squeeze Gen Zers are facing. More than 6 in 10 of the oldest Gen Zers said earlier this year that they had stopped or reduced their retirement savings in the past several months, a separate study found.
Two-thirds of these Gen Z folks added that they hadn’t been able to contribute to savings as much as they’d like because of other demands.
There are some glimmers, however, Fidelity said 34% of IRA accounts owned by Gen Z had a contribution between Jan. 1 and March 20, compared with 20% of accounts owned by millennials and 13% for Generation X.
All the while, their credit scores are plunging. As of late 2025, Gen Z has the lowest average credit score among all age cohorts at 678, a three-point drop from the previous year and well below the national average of 714, placing them in the “competent” to “fair” range.
FICO scores are a series of three-digit numbers ranging from 300 to 850 based on an individual’s spending and debt. A high FICO credit score is typically considered 740 and up, which lenders view as low risk. Scores from 740 to 799 are rated as “very good,” while scores of 800 or above are classified as “exceptional.”
Read more: This map highlights the average credit score in every state
“The resumption of required student loan payments has nudged the average score slightly lower,” said Ethan Dornhelm, head of scores analytics at FICO.
Nearly one-third, or 7.1 million, of student loan borrowers who had a payment saw a new delinquency reported on their credit file, per FICO’s research. That pushed their credit scores, on average, down 62 points since January 2025.
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If you’re getting by on an entry-level salary, plus struggling with student loan and credit card debt, it can feel crushing. Last year, for example, Gen Z consumers, most of whom are in their 20s, carried an average credit card balance of $3,493, according to Experian data.
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