More Students Are Putting Basic Needs on Credit Cards. Here Is How to Break the Cycle Before It Follows Them Into Repayment.

More college students are covering everyday costs with a credit card, and new survey data shows that habit is growing fast. According to Trellis Strategies, the nonprofit research group behind the largest annual survey of student finances, 54% of undergraduates used a credit card in 2025. That is up sharply from 43% in 2018. Among those cardholders, 88% said they used the card for basic needs such as food, housing, or transportation, not discretionary spending.

The harder number is what happens next. Only 47% of student cardholders pay their balance in full every month. The rest carry debt forward, and Trellis found that carrying a balance is tied to real strain: more worry about covering monthly expenses, more trouble concentrating on schoolwork, and a debt load that a third of respondents called unmanageable.

If this describes your student, or your own household budget this semester, you are not dealing with a personal failure. You are dealing with a well-documented, fast-growing pattern. Here is what the data actually shows, why the debt is so hard to escape once it starts, and what to try before a credit card becomes the default answer to a tight month.

What the New Data Shows

The numbers come from the 2025 Student Financial Wellness Survey, published by Trellis Strategies, which gathered responses from more than 65,000 undergraduates at 153 institutions across 23 states. Trellis also drilled into the more than 32,000 respondents who identified as credit card users, and that deeper cut is where the credit card story gets clearer.

A few figures stand out:

• 54% of all respondents used a credit card in 2025, compared with 43% in 2018. That is an 11 percentage point jump in seven years.
• 88% of student cardholders said they used their card to pay for basic needs like food, housing, and transportation.
• Only 47% of cardholders paid their balance in full each month, meaning a majority carried some debt forward.
• Among students carrying a balance, 88% said they worried about covering their monthly expenses, compared with 61% of students who paid in full.
• 60% of students with an unpaid balance said financial stress made it harder to concentrate on schoolwork, compared with 43% of students who paid in full.
• About one in three students carrying a balance described their credit card debt as unmanageable.
• 75% of all cardholders paid their bills on time, but 14% said they struggled to do so. Among students who did not pay their balance in full, that struggle rate jumped to 31%.

This is correlational survey data, not a controlled experiment, so it describes what students reported rather than proving that a credit card balance causes lower grades. Still, a sample this size makes the pattern hard to dismiss: the students most likely to be behind on a credit card are also the students most likely to say money worries are following them into the classroom.

How This Connects to the Bigger Basic Needs Picture

This survey is part of the same Trellis research that found 54% of undergraduates faced food insecurity, housing insecurity, or homelessness at some point in the past year, a figure CollegeLens has covered in detail. The credit card data adds a missing piece: when the gap between income and expenses shows up, a credit card is often the tool students reach for first, not a last resort. It is available immediately, does not require an application to a financial aid office, and does not ask a family to explain why the money is short.

That convenience is exactly why the debt is so easy to accumulate and so hard to see coming.

Why the Debt Is So Hard to Escape

A credit card used for groceries or a utility bill does not behave like a planned purchase. It behaves like a loan taken out at the worst possible moment, usually with the worst possible terms.

The math works against you fast. The average credit card interest rate for people with limited or fair credit, which describes many students building a credit history for the first time, tends to run well above the average for all cardholders. Carry a $1,000 balance and make only the minimum payment, and it is common for a card to charge more in interest over a year than the original grocery run or textbook purchase ever cost.

Minimum payments are designed to stretch, not shrink, a balance. A minimum payment is usually calculated as a small percentage of the balance plus that month's interest. Paying only the minimum on even a modest balance can take years to clear and can cost more in interest than the balance itself, especially at rates in the 20% range that are common on cards issued to people with thin credit files.

One missed payment can trigger a much higher rate. Many cards include a penalty APR that kicks in after a payment is late by 60 days, and that higher rate can apply to the existing balance, not just new charges. A single rough month can turn a manageable balance into a much more expensive one.

A thin credit file makes the problem circular. Students who are new to credit often qualify only for cards with higher rates and lower limits, so a stretch of bad months uses up the limit fast, credit utilization climbs, and that utilization itself lowers the credit score that would otherwise help qualify for a better rate down the road, including on a future private student loan or a co-signed lease.

Federal law adds one real guardrail. Under the CARD Act, anyone under 21 generally needs a co-signer or proof of independent income to open a credit card. That protects against a card with a limit bigger than a student's income can support, but it does not prevent someone who qualifies on their own, or with a parent's help, from running up a balance they cannot easily pay down.

None of this means a credit card is the wrong tool in every situation. It means a credit card used to cover basic needs is usually a symptom of a gap that has other, cheaper ways to close, and those options are worth trying first.

Better Options Before You Reach for a Credit Card

Every one of these is free to ask about, and none of them will show up as a mark against a student's credit.

• Ask your financial aid office about emergency grants. Many colleges keep a small fund specifically for students facing a sudden gap, whether that is a broken laptop, an unexpected medical bill, or a short-term housing crisis. These funds are often first come, first served, so it is worth asking even before you are certain you qualify.
• Request a professional judgment review if your finances changed. If your family's financial picture has shifted since you filed the FAFSA, a job loss, a medical expense, a new sibling in college, financial aid offices can reconsider your aid based on your current situation instead of the prior year's tax return the FAFSA formula uses. This is a normal, built-in part of the system. Start with the aid office and reference your FAFSA submission when you ask.
• Ask the bursar about a short-term, no-interest payment plan. If the strain is coming from a single bill rather than everyday expenses, many colleges will split a balance into smaller monthly payments through the school itself, often at no interest, rather than sending it to collections or leaving a student to put it on a card.
• Check whether SNAP applies. College students face extra eligibility rules for federal food assistance, but working students, student parents, and students in qualifying work-study positions can often qualify. A short call to your state's SNAP office or a campus benefits navigator can clarify this quickly.
• Use the campus food pantry. A large share of students do not know their school has one, and most are open to any enrolled student with no proof of need required at the door.
• Treat Buy Now, Pay Later the same way you would a credit card. It can feel like free short-term room, but multiple BNPL payments stacked on top of rent and a credit card balance can add up just as fast, without a single statement showing the full picture.

A Two-Minute Check Before You Swipe

Before a routine expense goes on a card out of habit, it is worth pausing on a few questions.

• Is this a one-time expense, or the same category I have charged for three months running?
• Have I checked whether my school's emergency fund or food pantry covers this?
• Do I know the interest rate on this card, and what this purchase will actually cost if I only make the minimum payment?
• Is there a free or no-interest option, a payment plan, a professional judgment review, a benefit I have not tried yet?

If the honest answer to the first question is "the same category as last month," that is the clearest sign the real fix is a conversation with the financial aid office, not another charge.

If You Already Have a Balance, Here Is How to Get Out

If a balance already exists, the goal shifts from prevention to getting out with as little extra cost as possible.

• Start by listing every balance, its interest rate, and its minimum payment. You cannot make a plan around debt you have not fully counted.
• Pay more than the minimum on at least one card, even by a small amount. Two common approaches both work: pay off the card with the smallest balance first for quick momentum, or pay off the card with the highest interest rate first to save the most money over time. Either beats making only minimum payments across the board.
• Call the card issuer and ask about a hardship program. Many issuers can temporarily lower the interest rate or waive a fee for a customer who calls before missing a payment, not after.
• Be cautious with balance transfer offers if you are still building credit. A 0% introductory rate can help, but transfer fees and a sudden hard inquiry on a thin credit file can work against a student who does not yet have the credit history to absorb them well.
• Avoid closing the card once it is paid off if it has no annual fee. Keeping the account open, unused or nearly so, generally helps rather than hurts credit utilization, which matters for the interest rate you will be offered on future borrowing, including private student loans if your family ever needs one.

Frequently Asked Questions

Is it normal for college students to carry credit card debt?

It is common. Trellis found that a majority of student cardholders do not pay their balance in full each month, and that share has grown since 2018. Common does not mean cost-free, since carrying a balance still means paying interest and can affect a student's credit for years.

Does credit card debt affect financial aid eligibility?

Credit card debt itself is not reported on the FAFSA and does not directly change your Student Aid Index. It can still affect your family's real ability to pay, which is exactly the kind of change a professional judgment review is meant to address if the debt reflects a genuine drop in your financial picture.

Should a student get a credit card at all?

A card used carefully, for planned purchases that are paid in full each month, can build a useful credit history. The concern this survey raises is specific: using a card as the default way to cover food, rent, or transportation when the money is not there yet, which is a different pattern than building credit responsibly.

What is the fastest way to know if a balance is a problem?

If a card is being used for the same category of expense, like groceries or gas, month after month without being paid off, that is a sign the underlying budget gap needs a different fix than more available credit.

Where can a family get help figuring out the bigger cost picture?

A full view of college costs, aid, and savings side by side makes it easier to see where a monthly gap is coming from and whether it is a one-time stretch or a pattern that needs a bigger plan.

The Bottom Line

More students are putting basic needs on a credit card than at any point since Trellis began tracking the trend, and most of them are not paying it off each month. The debt that results is not a character problem. It is what happens when a real gap between cost and available money meets the easiest tool available to close it in the moment.

The good news is that most of the alternatives, emergency aid, a professional judgment review, a no-interest payment plan through the bursar, campus food resources, cost nothing to ask about and do not follow a student the way credit card interest does. Trying them first, before the card becomes the default, is the difference between a rough month and a debt that outlasts the semester that caused it.

To see your full cost picture and where the real gaps are before they turn into a balance you are still paying off next year, create your free CollegeLens plan and map out the rest of the year with real numbers instead of guesswork.

-- Sravani at CollegeLens