Who Went Bankrupt in 2006? A Demographic Analysis of American Debtors

22 Pages Posted: 17 Jan 2008 Last revised: 25 Jan 2008

Date Written: May 2007


The explosion of personal financial crisis, especially foreclosure, across large and diverse segments of the American population in 2007 and 2008 significantly impacted the American and global economies. This causal connection supports a hypothesis that reducing the incidence of personal financial crisis and accelerating recovery there from should have a positive macroeconomic impact. The first step in the development of effective educational programs that help Americans reduce the incidence of and/or recover from personal financial crisis is the clear identification of those Americans in personal financial crisis. In 2006, the Institute for Financial Literacy's Center for Consumer Financial Research (CCFR) established a comprehensive, neutral research program designed to collect demographic information from individuals contemplating and eventually filing for bankruptcy protection, a population that is by definition in personal financial crisis. Utilizing the Institute's capacity for large scale data collection, information was collected for the period January 1, 2006 through December 31, 2006 in the following categories: gender, age, ethnicity, educational attainment, personal income level, employment status, marital status and cause(s) of financial distress. Data collected indicate that the average American who is in financial distress and seeking bankruptcy related credit counseling and financial education is: Caucasian, married, employed, between the ages of 35-44 years old, has at least a high school education or some college, and makes no more than $30,000 per year. In light of its findings, this paper challenges the academic community to begin exploring the causes of and crafting solutions for America's ever growing personal debt problem.

Keywords: bankruptcy, debtor, debt, financial education, financial literacy, Institute for Financial Literacy, BAPCPA, credit counseling, debtor education, financial management course, demographics, financial counseling, statistics, bankrupt

Suggested Citation

Linfield, Leslie E., Who Went Bankrupt in 2006? A Demographic Analysis of American Debtors (May 2007). Available at SSRN: https://ssrn.com/abstract=1084873 or http://dx.doi.org/10.2139/ssrn.1084873

Leslie E. Linfield (Contact Author)

Institute for Financial Literacy ( email )

260 Western Ave., Suite 1
Sourth Portland, ME 04106
United States

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