The widespread costs and expenses of a health crisis are pushing many Americans into financial trouble, a new study has found.
What You Should Know
According to a new study by the financial services company JG Wentworth, conducted in February 2026 and evaluating 1,421 adults in the US, almost half of each person’s bankruptcy is caused by the cost of living and interest rates. When asked what contributed most to their bankruptcy, 43.4 percent of respondents cited the cost of a life crisis, making it the most common factor. Fee increases followed closely, reported by 41.7 percent.
Other reasons were cited more often as contributing factors to bankruptcy, including increases in mortgage payments and interest (1.3 percent), poor financial planning (0.3 percent), death of a loved one (0.2 percent) and unexpected expenses (0.2 percent).
Non-commercial films are up 10.8 percent between September 2024 and September 2025, reflecting increasing pressure on American households, according to the firm. By 2025, the bank’s total interest rates will rise by 11 percent, with an increase in commercial and non-commercial bankruptcies, the United States Courts announced in February. There were 549,577 bankruptcies last year.
Among respondents who reported filing with a bank, the timing is almost evenly split. About 45.8 percent said they had given in the past three to five years, while 45.2 percent said they had given in the past six to 10 years.
Limited Financial Buffers
The survey also sheds light on how many households have limited financial resources. When asked how long they could cover the expenses if their income suddenly stopped, 40.8 percent said they could handle it in just three months. On average, respondents said it would take $6,356.55 in additional debt to push them to the brink of bankruptcy.
The Permanent Impact of Bankruptcy
The research also examined how people recover after filing. Almost nine out of 10 respondents (89.3 percent) said they were able to rebuild financially, although this usually took five years.
At the same time, many report continuous results. According to the survey, 97.8 percent said they are still feeling the effects of their bankruptcy, regardless of when they filed or whether they have recovered financially. Nearly three-quarters (73.7 percent) said the bankruptcy is still affecting their ability to get loans or credit, while 73.3 percent said their credit score is still being affected.
Among those who had not fully refinanced their finances, 88.4 percent pointed to the high cost of living and rising costs as the main reason. This was followed by ongoing low income or unemployment (85.8 percent) and ongoing medical expenses or health problems (82.5 percent).
In addition to financial problems, respondents described the emotional stress associated with bankruptcy. Participants said filing was more stressful than having a baby (35.5 percent) or buying their first home (36.6 percent).
Even after they recovered, 8 percent said they were still feeling the effects of their bankruptcy, regardless of how long ago they gave.
Trump’s payments
Although the survey covers those who applied before the current Trump administration, the latest tariff plan is believed to have raised costs for families.
Tariffs are taxes on imports, paid by businesses that import products into the country. These costs are often passed on to consumers through higher prices, affecting everyday goods as well as domestically produced goods that depend on imports.
Almost a year ago, in April 2025, President Donald Trump introduced tariffs that would be rolled back by invoking the International Emergency Economic Power Act, including a 10 percent tax and even higher tariffs on some trading partners. In February 2026, the Supreme Court ruled most of those emergency fees unconstitutional, beginning the process of issuing compensation to affected retailers.
During the time those measures were in effect, American households paid an estimated $1,745 in toll-related costs between January 2025 and January 2026, according to Legal Clarity.
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