Wonder

U.S. Personal Bankruptcy Statistics

Delivered February 10, 2020. Contributor: Terri A.

Goals

To find 4-5 statistical insights into personal bankruptcy, with a focus on individuals who have high assets but low cash flow, in order to help determine a market size for individuals who may wish to invest in a company that would loan money to people seeking asset protection plans.

Early Findings

While bankruptcy rates overall decreased from 2005 to 2010, bankruptcy among individuals making over $60,000 per year nearly doubled in this time frame. 
In 2010, roughly 9.18% of people filing bankruptcy fit into the $60,000+ income category, as compared to only 5.5% of individuals in 2006.
However, individuals making less than $30,000 per year are still the most likely to file for bankruptcy. These individuals are more likely to file for Chapter 7 bankruptcy. 
In contrast, individuals with assets to protect are more likely to file for Chapter 13, rather than Chapter 7, bankruptcy. 
Among individuals with high wealth in assets, such as real estate investors, factors leading to personal bankruptcy can include investing in companies with too much risk/too many unknowns (speculating) , a lack of education about real estate investing, a lack of proper analysis of their properties, and failing to treat real estate investing as a full-time job.

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