Gen Z’s credit scores are cratering—and Trump’s student loan crackdown is the biggest reason why

The Trump administration has moved aggressively to restart student loan collections, and a record number of borrowers can’t keep up. The result is showing up in a damaging and lasting way: A generation of young Americans are watching their credit scores collapse.

Credit scores are a core part of personal finance in the U.S. They determine Americans’ access to favorable loans and credit cards, and can even factor into applying for a job. Having good credit is especially relevant for young people, who can benefit the most from better loan terms and job opportunities as they make major financial decisions.

Without years of a good credit baseline, Generation Z is also the most likely to suffer the biggest drops when things go wrong.

Gen Z bears the brunt of falling credit scores

Credit scores are dipping for all Americans. The national average credit score fell to 714 in the second half of 2025, according to a report released Tuesday by FICO, an analytics company that produces the most widely used credit scoring model. It was a decline from the 715 average recorded in the first half of the year, and represented the lowest score since early 2020.

Last year already ranked...