california Leads teh Nation in Credit Card Debt Increase
New data reveals California is experiencing the largest surge in credit card debt among all U.S. states. An analysis of TransUnion and Federal Reserve data from the first and second quarters of 2025,adjusted for inflation,conducted by the personal finance website WalletHub,shows the state’s combined credit card debt exceeding $167 billion.This represents an increase of over $3.5 billion during the analyzed period.
Texas followed closely behind, ranking second with a total credit card debt of nearly $124 billion and an increase of $2.6 billion.
California also holds the No. 2 position nationally for average household credit card debt, currently at $13,847. Only Hawaii surpasses California with an average of $15,052 per household. The average Californian household saw a $263 increase in credit card debt each month, second only to Hawaii’s $286 monthly rise.
The top ten states with the largest credit card debt increases are:
- California
- Texas
- Florida
- New York
- Illinois
- Pennsylvania
- Georgia
- ohio
- New Jersey
- North Carolina
Nationally, U.S. consumers added $28 billion to their credit card balances in the second quarter of 2025, bringing the total outstanding debt to approximately $1.32 trillion. Preliminary July data indicates a 0.4% year-over-year increase in credit card debt.
WalletHub offers several strategies for managing and reducing credit card debt, including:
* Budgeting: Creating and adhering to a monthly budget to track income and expenses.
* Emergency Fund: Building a financial safety net equivalent to approximately one year’s after-tax income.
* Credit Improvement: Strengthening credit standing to secure lower interest rates and improve financial opportunities.
* Job Evaluation: Considering higher-paying employment or skill advancement to increase income.
* debt Prioritization (Avalanche Method): Focusing extra payments on the credit card with the highest interest rate.
* Strategic Card Use (Island Approach): Utilizing different credit cards for specific purposes, such as balance transfers or rewards programs, to optimize terms and avoid finance charges.
