Structured settlements are financial agreements that allow a compensation to be paid through an annuity in form of regularly scheduled payments - could be monthly, quarterly or yearly. Such payments could be for a fixed period of time or for the life of the recipient.
Some situations are very well suited for such structured settlements. For instance - cases that involve serious injury as a result of which the claimant is unable to work for a long time, wrongful death where the deceased was an earning member of the family and the family needs to be paid for financial support, or in such cases as lottery winnings. The idea of a structured settlement is to make the payment plan more agreeable for all the parties involved without putting any serious financial risk to either of the parties. It also provides both the parties with a tax advantage.
Claimants often prefer structured settlement agreements over lump sum payments as that provides them a sense of financial security in form of monthly payments and steady income. However, life can turn around in a blink and you might need the money right now. Say for instance you have to pay your kids' college tuition or a hefty medical bill. In such a case, you would want to have a lump sum cash instead of monthly payments. But you cannot change your structured settlement provision when need be. Hence, you need to sell structured settlement in such a case. You have the option to sell your annuity for a lump sum payment. You can sell the complete annuity or just a part of it. It is recommended to only sell that portion of your annuity that would cover your immediate financial needs while you retain the remaining annuity.
Another motivation for selling your annuity could be to start a new life, a new business, etc. and in such a case, you would need to sell your annuity completely. Another argument for selling your annuity could be inflation. A dollar today is worth more than future dollars and so if you get a lump sum amount and invest it wisely, you would be better off in future than you will be if you continue receiving your monthly payments. In either case, you are entitled to selling your structured settlement.
When choosing a company or professional to sell your annuity to, make sure that the company or the professional has been in the business for at least a few years and has a good track record. Doing a simple Google search about the company name should give you an idea of the company's work ethics and their general customer feedback. Do your due diligence before selecting an annuity buyer. Don't fall for shady brokers.
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