New Book Reveals Insights into Bankruptcy Filers in the U.S.

CHAMPAIGN, Ill. — A new book co-authored by a University of Illinois Urbana-Champaign professor explores the experiences and challenges faced by individuals filing for bankruptcy in the U.S. The book, published by the University of California Press, emphasizes the difficult and often fragile financial conditions that lead to bankruptcy.

The book’s co-author, Jennifer Lawless, a Max L. Rowe Professor of Law, discusses how financial instability can escalate from a single unexpected expense. “What it means to live in a state of financial precarity is crucial to understanding why people seek bankruptcy,” said Lawless, who is also the co-director of the Illinois Program on Law, Behavior and Social Science.

The book draws from 11 years of data taken from the Consumer Bankruptcy Project and blends statistical findings with personal stories of bankruptcy filers to illustrate key themes. “There are many roads to bankruptcy in the U.S., and we aimed to present these complexities in a way that is accessible to a broad audience,” Lawless explained.

One significant finding is the disproportionate impact of bankruptcy on specific demographics, particularly single women with children and Black individuals. Lawless stated, “The social patterns we see in society, such as racial and gender wealth inequality, also reflect in the bankruptcy court.”

Health-related issues continue to be a major contributor for many seeking bankruptcy protection. Lawless noted that the Affordable Care Act has improved access to some healthcare options, but has not eliminated medical debt. “People still face high co-pays and bills that can accumulate quickly, especially if they become unable to work due to illness,” she said.

As poverty levels rise, people often resort to high-interest loans or payday lenders to cover immediate needs, creating a cycle of financial dependence that worsens their long-term situations. “It’s a rational choice in desperate circumstances, but it reflects a broader societal shift from communal support to individual responsibility,” said Lawless.

Approximately 1 million people file for bankruptcy each year in the U.S., and this number continues to fluctuate. “Around one in eleven people will use the bankruptcy system at some point in their lifetime,” Lawless remarked. This reality often carries a social stigma that discourages those affected from seeking out the help they need.

The book aims to raise awareness on how financial struggles can affect individuals from all walks of life and how systemic inequalities contribute to these experiences. Lawless concluded, “We hope readers come away with a deeper understanding of the human side of bankruptcy and the factors that lead people to this difficult choice.”