Iowa Currently Top 10 in the Nation for Increasing Bankruptcies

Taxes, Inflation, and now bankruptcy? What exactly is going on in our economy? Iowa has always been known as the land of corn, pigs, Iowa-nice, and your first shot at the political caucus, but now we're known for bankruptcies as well. Wait. What exactly does that mean? Well, according to new data from the Administrative Office of the U.S. Courts, Iowa just clocked in at No. 9, with filings up a not-so-glamorous 17% over the past year.

YIKES! It’s not exactly the kind of “Top 10" we (or anyone) were aiming for, but hey, if we’re going to do something, let’s do it with Midwestern efficiency, apparently.

In total, more than 542,000 bankruptcies were filed nationwide in the 12 months ending June 30. That’s an 11.5% jump from last year. Iowa, true to its hard-working, quietly suffering brand, outpaced the national trend. Only eight other states, including Florida, Minnesota, and Rhode Island (which somehow took the gold medal with a 27.6% spike), beat us to the financial bottom, so to speak.

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So what’s behind the surge? Inflation’s still doing its thing, wages aren’t exactly sprinting to catch up, and debt is ballooning like a county fair bounce house. Toss in some post-pandemic aftershocks and a dash of tariff trouble, and you’ve got yourself a recipe for stretched wallets in the Midwest. Additionally, Iowa sits dead center at No. 24 when it comes to best and worst places to do business, according to Newsweek. So if your business or career can't thrive, how can you pay down your loan? Food for thought.

Of course, not all debt is created equal. Maxed-out credit cards, missed mortgage payments, and “buy now, cry later” shopping habits are catching up. Simple rule to live by: if you don't have the cash, you shouldn't have the item. Contentment could go a long way for some individuals. By the way, LegalShield says bankruptcy inquiries are “significantly elevated,” as of April 2025. Translation: a lot of people are Googling lawyers about wiping out a debt they can't afford.

But let’s not get too down on ourselves. Being in the top 10 for bankruptcies at least means we’re not alone, or at the bottom of the barrel. Misery loves company; we have California, Texas, and Colorado joining us. By the way, only three states saw a decrease in bankruptcies: Soth Dakota, Alaska, and Delaware. Check out the top (or bottom) 10 list.

Top 10 States by Bankruptcy Filing Increase (% Change YoY)

1. Rhode Island — +27.6%
2. Florida — +23.5%
3. Minnesota — +21.0%
4. Vermont — +20.3%
5. Texas — +19.4%
6. Idaho — +19.1%
7. Maine — +17.9%
8. Colorado — +17.6%
9. Iowa — +17.0%
10. California — +16.6%

So, unfortunately, Iowa. We're trending. Just for all the wrong reasons. But maybe, for some of you, this is the wake-up call you needed. Or at least a reason to cut back on that impulse Amazon shopping.