When the financial crisis was at its peak, almost 1.6 million people in California and the rest of the United States filed for bankruptcy. Almost one decade later, the number of filings is less than 800,000. However, the difference in the number of filings is not an indication of economic health by itself.
Filing for bankruptcy can be very expensive, as attorneys can charge up to $1,000 to file a Chapter 7 bankruptcy. Also, it is challenging to use bankruptcy to discharge student loans. Still, many people can use the bankruptcy process to give themselves a clean financial slate.