Bankruptcy Statistics and the Things We Can Learn From Them

Written By
G. Dautovic
October 30,2023

What’ll it be this time—the rent, the electricity bill, or food? There’s money enough for just one of these, and that’s not counting last year’s huge medical bill. The ambulance ride alone cost more than $1,000.

This is what real life looks like for a lot of Americans. Bankruptcy statistics show an alarming number of individuals, families, and corporations face insolvency every year. Bankruptcies have serious consequences for personal lives, businesses, and even the national economy. 

To paint a clear picture of the state of American finances, we’ve compiled a list that examines each aspect of bankruptcy and the factors that contribute to it. We’ve included an FAQ, too, which you can scroll to if you’re in need of quick answers. 

Here’s everything we know about bankruptcy numbers.

Key Bankruptcy Statistics for 2024 - Editor's Choice

  • 1.6 million individuals and companies filed for bankruptcy In September 2010.
  • 770,000 individuals and companies filed for bankruptcy in September 2018.
  • Americans owe $1.6 trillion in student debt.
  • A 2012 study demonstrated that 60% of people who file for bankruptcy earn less than $30,000 a year.
  • Chapter 13 filings are dismissed at an 18x higher rate than Chapter 7 filings.
  • Medical debt is the cause of 18–26% of all consumer bankruptcies.
  • Obamacare’s Medicaid Expansion provision reduced unpaid medical bills sent to collection by $3.4 billion over two years.

Bankruptcy Around the World

In 2022, global bankruptcies increased by 10.6%.

(Dun & Bradstreet)

The previous year proved to be highly turbulent for the global economy, as the impact of the pandemic and the Russo-Ukranian war shook the world. For comparison, in 2021, bankruptices in the countries observed in the Dun&Bradstreet report rose by only 0.6%

3 out of 5 countries will exceed the pre-pandemic insolvency records in 2024.


The data from last year indicates that Western Europe is the biggest contributor to the rise in insolvencies, with Allianz predicting that in 2024, the largest number of insolvencies will be in France (59,000 cases), followed by 28,500 in the UK and 17,800 in Germany.

The United Kingdom, Austria and France saw a 50% increase in bankruptcies in 2022 compared to the year before.

(Dun & Bradstreet)

The latest data shows that bankruptices in Europe reached the highest levels since 2015, largely driven by massive increase in bankruptices in Spain, which by Q4 2022 jumped 350% compared to Q4 2019.

Bankruptcy in the United States

48% of people who file for bankruptcy are male.


According to, men are slightly less likely to go bankrupt than women, who represent 52% of all bankruptices, even though this gap has been shrinking in recent years. The most common reason men go bankrupt is because they lost a job, and the most common reason women go bankrupt is divorce.

64% of people who file for bankruptcy are married.


Personal bankruptcy statistics show that most debtors are married. Many file for joint bankruptcy to make the process easier. For comparison’s sake, 17% of debtors are single, 15% are divorced, and 3% are widowed.

Recent studies show that 36% of people who file for bankruptcy have only a high school education.


In addition, 20% of debtors have a bachelor’s degree or higher, and 29% have “some college education.” Those who’ve gone to college but haven’t graduated are at a particular risk because of mounting student loan debt.

60% of people who file for bankruptcy earn less than $30,000 a year according to the most recent data available.


Unsurprisingly, bankruptcy rates are the highest among those who earn the least. Stats also show that only 9.2% of those who report making more than $60,000 annually go bankrupt.

327,371 is the number of year-to-date national bankruptcy filings for May, 2019.

(American Bankruptcy Institute)

American Bankruptcy Institute statistics also show the number of Chapter 7 and Chapter 13 filings so far—204,910 compared to 119,293 in the same period last year. There is a 3% decrease from May compared to April.

Corporate Bankruptcy Statistics

Corporate bankruptcy filings in the second quarter of 2019: New York (636), California (577), Texas (530), Illinois (486), Pennsylvania (483).

(Kaplan Collection Agency)

If you take these numbers at face value, it seems dangerous to do business in New York, California, Texas, Illinois, and Pennsylvania. However, the issue with simply adding up the number of bankruptcies is that the states with the biggest populations will always come out on top.

South Dakota (10), Vermont (12), Wyoming (12), Alaska (13), Hawaii (14)—states with least corporate bankruptcy filings in the second quarter of 2019.

(Kaplan Collection Agency)

When it comes to going bankrupt, states as small as Wyoming certainly don’t have a large number of filings. But like the previous statistic, these numbers don’t tell the whole story.

Delaware, Missouri, New Hampshire, Kansas, Illinois, Pennsylvania – states with the most corporate bankruptcy filings adjusted for population.

(Kaplan Collection Agency)

Now we’re getting somewhere. Delaware ranks at the top here because many companies incorporate there due to favorable corporate charter laws. It wouldn’t otherwise be on the list.

Chapter 7 and Chapter 13 United States Bankruptcy Statistics

September 2010: 1.6 million bankruptcies were filed in American courts.


During one of the most severe financial and economic meltdowns in American history, bankruptcy rates rose to unprecedented levels. The Great Recession led to 1.6 million bankruptcy filings, with 1.53 million of them attributed to consumer bankruptcies alone.

September 2018: 770,000 bankruptcies were filed in American courts.


Compared to 2010, this sounds like great news. In fact, US bankruptcy statistics show that the number of petitions hasn’t been this low since 2007. But these numbers are misleading. When presented on their own, they paint the wrong picture about the state of the American economy and its impact on the society.

So, if the economy hasn’t improved that much, why are there fewer people filing for bankruptcy? The answer is simple—they can’t afford it.

The national average attorney’s fee for Chapter 7 bankruptcy cases is $1,250.

(Maurer School of Law)

Bankruptcy data shows that simply filing for bankruptcy can be an impossible feat for impoverished families. Chapter 7 cases, in which the debtor sells off certain assets to have a part of their debts forgiven, take $1,200 on average just to file. The sum has to be paid upfront, and that doesn’t include court taxes and other fees.

When you can barely make ends meet and hiring a lawyer is not an option, what can you do?

The national average attorney’s fee for Chapter 13 bankruptcy cases is $3,200.

(Maurer School of Law)

For a lot of people, Chapter 13 is the bankruptcy solution of choice. The overall cost will depend on the complexity of the case, but bankruptcy stats show that the average is $3,000, plus extra fees for complications. However, since Chapter 13 allows debtors to repay all or part of their debts over three to five years, part of the lawyer’s fee can be paid over time, after the resolution of the case.

Chapter 13 filings are dismissed at an 18 times higher rate than Chapter 7 filings.

(Maurer School of Law)

Even though Chapter 13 looks like a good solution, it often makes the problem even worse. With a failure rate of 68%, bankruptcy filing statistics show that Chapter 13 is a gamble for many debtors. While hiring a lawyer can increase your chances of success, having the case dismissed will inevitably put you in a worse position than you were in, with no chance of getting a fresh start. People are often forced to either file for Chapter 13 because they don’t have the money to file for Chapter 7, or suffer with their debts with no chance of judicial relief.

The Heavy Burden of Student Loans

Americans owe $1.6 trillion in student debt.

(The Guardian)

Another leading cause of the decline in bankruptcies: student loans. They are completely non-dischargeable in most cases, so people crushed under the burden of their crippling college debt cannot apply for bankruptcy.

80% of participants in a student debt survey report being unable to save for retirement because of their student loans.

(Summer and Student Debt Crisis)

It’s no wonder people aren’t going bankrupt: Statistics show tackling on student loans makes it almost impossible to plan for retirement, and many young people don’t expect to pay them off any time soon.

56% of participants in a student debt survey report being unable to buy a home because of student loans.

(Summer and Student Debt Crisis)

The report from the non-profit organization Student Debt Crisis and a student-debt advisory firm called Summer sheds even more light on the American bankruptcy statistics we’ve shown you. Without the option to file for bankruptcy, people are stuck paying off their loans without the ability to start making a life for themselves.

65% of participants in a student debt survey report that their student loan bills are bigger than their food budgets.

(Summer and Student Debt Crisis)

Additionally, 30% said that student loan bills were higher than their mortgage or rent, and 56% claim that they’re higher than their health insurance bills. Young people are struggling more than ever just to make ends meet, let alone build a stable life.

Consumers aged 18 to 34 had fewer bankruptcies over the last decade per capita compared to people aged 65 or over.

(Indiana Legal Studies)

When it comes to bankruptcy in America, statistics show a clear trend: Young people have no way to repay their student loans. This tends to lower their credit scores, which in turn makes it difficult to obtain loans, credit cards, and mortgages. It’s a vicious circle that’s grinding people down because they are forced to live on a cash basis, leaving them unable to start anew with bankruptcy or to build up any kind of assets.

(There is a slim chance of filing for bankruptcy to dismiss student loans. To apply, you must file an Adversary Proceeding lawsuit with the bankruptcy court and provide evidence that paying the student loan would create undue hardship. These claims are difficult to prove, and the filings are dismissed most of the time.)

Health Care Bankruptcy Statistics

Medical debt is the cause of 18 to 26% of all consumer bankruptcies.

(Maine Law Review)

It’s sometimes difficult to determine the exact cause of personal bankruptcy because debtors don’t have to state why they’re filing and they often have to juggle several financial obligations, all of which contribute to overall debt. While several studies have suggested that medical bills cause as many as 60% of bankruptcies, the reality is almost certainly a little less dramatic. The study we quote here was conducted by Daniel A. Austin, a bankruptcy attorney and professor at Northeastern University School of Law.

According to his health care bankruptcy statistics, medical bills are the strongest factor in 18 to 26% of bankruptcies. The data is based on a nationwide group of bankruptcy filers meant to represent a cross-section of the U.S. population. Austin and his team examined all of the individual case files and found that 18% of people had medical debt as the predominant factor in their bankruptcies. Besides the case files, Austin also ran a survey in which each debtor who filed for bankruptcy was asked whether medical expenditures played a role in their bankruptcy, and 26% of them “strongly agreed.”

These bankruptcy statistics are from 2014 and they were revised in November of 2015. While they aren’t as dramatic as some of the more popular claims, we do believe them to be more accurate. They still indicate that massive medical bills are putting many American people in debt, and that the only way for them to get back on their feet is to file for bankruptcy.

Medicaid Expansion reduced unpaid medical bills by $3.4 billion.

(National Bureau of Economic Research)

It’s not all doom and gloom. Medical bankruptcy statistics show us that another major reason bankruptcies are declining is Obamacare, the Affordable Care Act. Its Medicaid Expansion provision reduced the amount of unpaid medical bills by $3.4 billion in the first two years after it was introduced.

Medicaid Expansion helped make patients more solvent, increasing their creditworthiness, which resulted in lower interest rates and an overall savings of $520 million a year.

(National Bureau of Economic Research)

Researchers from Pennsylvania State University, University of California-Los Angeles, and the Consumer Financial Protection Bureau studied five million credit records, concluding that in states that accepted Obamacare’s Medicaid Expansion provision, consumers qualified for more favorable credit terms, resulting in aggregate savings of $520 million per year.

Average consumer credit scores have risen from 675 to 689 in states that adopted Medicaid Expansion.


Credit score statistics show yet more evidence that the Affordable Care Act has a positive impact on peoples’ financial well-being. It has helped a lot of people even out their debt levels and improve their credit score history, not to mention the fact that it made expensive, life-saving treatments easily available.

Healthy people make 28% more over their lifetimes than unhealthy people.

(National Bureau of Economic Research)

It’s not just about the government helping people live better lives, it’s also about people being able to contribute more to society. Healthy people earn more money, and a larger percentage of them are able to participate in the workforce compared to unhealthy people. To illustrate: Health care statistics in an NBER study demonstrate that among men aged 45 to 55, participation in the workforce is 90% among the healthy, while participation among the unhealthy is 70%.

The people and the government can each contribute to the overall state of the economy. With access to proper health services, the population can live longer, be more productive, and save more. In the end, everyone benefits.

A Little Bit of Hope

43% of people with a bankruptcy listed on their credit file have a credit score of 640 or higher within a year of the bankruptcy. Within two years of bankruptcy, 65% have a credit score above 640.

(The Street)

Although financial insolvency sounds like a nightmare, it doesn’t have to be. Most people manage to recover after a few years—and you can be one of those people. Improving your credit score after bankruptcy is possible. Rewrite your budget. Set up a savings account. Figure out what got you into bankruptcy in the first place and make a solid financial plan for the future.

There is no reason to be marked by your financial woes forever.

Beyond Bankruptcy

There’s one thing we want to make clear before we go—there is no shame in filing for bankruptcy. The social stigma attached to financial struggles shouldn’t prevent individuals or corporations from getting the help they need to pick themselves up and make a fresh start.

These bankruptcy statistics are troubling, but they aren’t hopeless. Within a few years you can take back the reins and recover. The process will be smoother if you take this time to learn more about managing your money to remain financially solvent.


What does it mean to file bankruptcy?


It might be a little difficult to read our bankruptcy court statistics if you’re not sure what bankruptcy is, so here’s a simple definition: Bankruptcy is a legal term used to describe a person or a business that can’t pay their outstanding debts. The debtor can start the process by making a petition in court, at which point all of their assets and valuables are closely examined. They may be used to repay a portion of the debts. In some cases the debts are dismissed entirely.

Is filing for bankruptcy public record?


Yes, it is a part of the public record. Bear in mind that people can read about the number of US personal bankruptcies by year, but obtaining any further information than that will be tricky. To access the information, you have to go through a public access system called PACER, but you need to pay for each page you want to take out of the system.In addition to that, your bankruptcy filings will appear on your credit report for up to 10 years, so if you want to apply for mortgages, loans, or any other kind of credit, lenders will be aware of your filing.

What percentage of bankruptcy is due to medical bills?


According to bankruptcy statistics by year, medical bills are the biggest factor in 18 to 26% of bankruptcies. Our answer to this question is based on Medical Debt as a Cause of Consumer Bankruptcy, a study by Daniel A. Austin. The study was published in 2014 and updated in 2015. Some studies claim that up to 60% of bankruptcies are due to medical bills, but this number is most likely overstated. Unfortunately, it’s difficult to pinpoint one single cause of bankruptcy because usually several factors contribute to someone’s financial problems. It’s entirely likely that 60% of those who file do have some sort of issue with medical debt, but studies point out that it’s not always the main cause.

How many bankruptcies are there?


According to national bankruptcy data, there are two types of personal bankruptcies—Chapter 7 and Chapter 13. There is also Chapter 12, which is almost exactly the same as Chapter 13 but is specifically aimed at farming families.

There are also Chapter 11 and Chapter 9 bankruptcies. Chapter 11 is aimed at large corporations that want to reorganize and continue their business, and Chapter 9 is when cities, towns, villages, counties, taxing districts, municipal utilities, or school districts have to file for bankruptcy.

What are Chapter 7 bankruptcies?


Also known as “liquidation bankruptcy,” Chapter 7 is the most common of American bankruptcies. When a person files for Chapter 7, a trustee is sent to collect all of the debtor’s non-exempt assets and liquidate them into cash. This money is used to repay some or all of the debt, and after that, the person no longer owes that specific debt. They can make a fresh start, but it becomes a part of their credit history. It can be exceptionally difficult to get credit after bankruptcy.

What are Chapter 11 bankruptcies?


This bankruptcy applies mostly to commercial enterprises. Here, the debtors plan to keep operating their business, and to get a bankruptcy filing approved, they must hand in a solid reorganization plan to return the business to profitability.

What are Chapter 13 bankruptcies?


Chapter 13 is aimed at individuals who have a source of income and want to repay their bankruptcy, but are currently unable to do so. If you take a look at the current bankruptcy statistics provided in the section “Chapter 7 and Chapter 13,” you’ll notice that it’s much more difficult to get approved for Chapter 13.


About author

I have always thought of myself as a writer, but I began my career as a data operator with a large fintech firm. This position proved invaluable for learning how banks and other financial institutions operate. Daily correspondence with banking experts gave me insight into the systems and policies that power the economy. When I got the chance to translate my experience into words, I gladly joined the smart, enthusiastic Fortunly team.

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