Californians have cooled their borrowings – and skipped more bill payments, two more signs of a stressful economy.
My trusty spreadsheet found these patterns within the Federal Reserve Bank of New York’s third-quarter study of credit files. The data includes the size and payments of consumer debts in 11 big states and the nation through the September 2025 quarter. These statistics only consider individuals with credit histories — a sizable but not comprehensive segment of the population. Debt levels are tracked as an average per person.
According to this math, Californians had $87,570 in consumer debt per person in the third quarter, a 1.2% increase from the same period a year ago. That’s a cooling from 2.9% growth in the previous 12 months, and it’s below the 3%-a-year expansion pace since 2003.
Yes, fewer debts are a desirable goal. Yet skittish consumers often prune borrowing as financial anxieties increase. For example, the Conference Board’s California consumer confidence index has decreased by 18% over the past year.
These debt-growth numbers are a contrast with borrowing patterns nationwide.
U.S. consumer debt increased by 2.5% in a year to $63,340 per person. That’s a pick up from 1.8% growth in the previous 12 months. Since 2003, consumer debts nationwide have expanded at an average annual rate of 3.2%.
Also, ponder California’s two main economic rivals.
In Texas, the $60,100 debt per person increased by 4.1% in a year – faster than the 1.9% growth in the previous 12 months or the 4% average since 2003.
Florida’s $62,460 marked a 3.5% jump in a year, outpacing the 2.9% rise in the previous 12 months and matching the 3.5% pace since 2003.
Late payments
Californians’ debt-paying troubles rose, too.
In the third quarter, 2.01% of California consumer bills were 90 days or more late. That’s up from 1.9% and the highest level of unpaid debts since the first quarter of 2020, when the pandemic first impacted the economy.
To be fair to California, however, the current bill-paying tardiness is well below the 3.56% average missed payment rate over the last 23 years.
Plus, Californians are paying their bills more effectively than their national peers. The U.S. delinquency rate was 2.98% in the third quarter of 2023 – roughly one-third above the Golden State.
Yes, that U.S. rate was down from 3.02% three months earlier. However, the nation’s late payments in the second quarter were at their highest level since the first quarter of 2020. The U.S. tardiness rate has averaged 3.74% since 2003.
Additionally, consider that late payments in Texas ran 3.85% and 4.1% in Florida in the third quarter – well above California’s rate.
Educational drag
A significant issue is missed student-loan payments, as federal repayment reprieves ended this year.
Nationwide, 14.3% of student debts went unpaid, up from 0.8% a year earlier, and the highest level in a data set that dates to 2000
The N.Y. Fed offered no state-level delinquency rates. But California has a below-average amount of education debts at $4,710 per person, accounting for 5% of overall borrowings statewide – well below national norms.
Nationally, student debts average $5,540, representing 9% of all borrowings. Texas? $5,350 per capita, 9% of debts. Florida? $5,110 per capita, 8% of all borrowings.
Jonathan Lansner is the business columnist for the Southern California News Group. He can be reached at jlansner@scng.com