The ads sound incredible. Sell your structured settlement now and get cash fast for whatever you need: paying bills, investing elsewhere, starting a business. But even though it may seem much less sexy to keep your settlement, there are some good reasons to do so.
Income. One reason why structured settlements are so frequently used to settle personal injury cases is because they provide for a steady stream of income to the plaintiff. You are guaranteed a fixed income for a period of months or years that you can use to meet everyday expenses. If your injury has left you unable to work temporarily or permanently, the settlement is, essentially, your income.
Guaranteed Return. Structured settlements are almost always based on annuities. The defendant put a lump sum of money into an annuity which is invested so that it earns a fixed rate of interest. This interest, when combined with the seed money, is able to pay out your settlement in identical payment over the course of months or years. Don’t fall into the trap of believing that you can somehow do a better job on investing this money. Insurance companies – who are usually responsible for administering annuities – have experts on staff with the training and time to devote themselves to investing the seed money. If an “investment advisor” or “financial advisor” is promising they have a lead on a “sure thing” that will get you a better rate of return, walk away.
Safety. One reason structured settlement buyers love these transactions is because of their relative safety. Since insurance companies usually manage the annuities that pay your structured settlement, there’s virtually no risk of default as long as the insurer stays in business. And, often, structured settlement funds are maintained in a protected fund, so payout is still assured no matter what happens.
The Whole Enchilada. Let’s say that your structured settlement pays you $50,000 per year for 10 years, for a total of $500,000. If you decided to sell that settlement, the amount you get will be less than $500,000 – a lot less. That’s because companies that buy structured settlements are in the business to make a profit, not to help you. To ensure they make their money, they have to pay you far less than what they’ll get from your settlement over time. If you have a truly urgent need, a real emergency that your structured settlement will solve, selling it could be an option worth pursuing. But if there is any other way for you to get by, selling is not a good deal.
If you need help selling your structured settlement, annuity or lottery payments,
contact us today. We are here to answer your questions and help you obtain the
highest possible price for your payments.
