It seems like a no-brainer. You’ve got this structured settlement that you were awarded as part of a personal injury lawsuit. Sure, you get regular payments, but you have to wait to get all the money that you’re due.
And then you see an ad from a company that promises fast cash to sell your annuity. You think about all you could do with a big lump sum of cash. Couldn’t you do so much more with the money now, other than waiting around for it? Why wouldn’t you sell?
You’re Going To Need It. If you were, say, 200 years old, and don’t think you’re long for this world, selling might make sense. But the whole point of making you wait for annuity payments is to make sure you don’t spend it all. If you were injured, especially if you’re now unable to work, the annuity is designed to ensure that money will be available to meet your medical and living expenses. Otherwise, you just don’t know what’s coming next.
You’re A Spendthrift. How many times have you seen a news story about some rocker or movie star who has racked up millions overnight and spent them even quicker? With all that money, you’d think they could hire an army of financial advisors to monitor their cash flow.
You don’t have millions. If any money you get seems to burn a hole in your pocket, if you’re easily seduced by ads of fancy cars or jewelry, or if you’re given to impulse buying (and lot’s of buyers’ remorse), think twice before selling your annuity. The annuity was meant to protect you – not just from creditors or medical bills, but from yourself.
You Don’t Have a Good Plan. What do you plan to do with the money you get from your structured settlement? You should already know that you will net far less in a sale than you would have gotten over time, and you won’t get anywhere near the amount of your original settlement.
Are you planning to pay off debts? If so, will the proceeds from your sale take care of your debts once and for all? Or will you still have bills to pay? Is there no other way to restructure or pay off what you owe?
Are you planning to fund a business? If so, how solid is your plan? Is this an established industry, or something new, exciting…and really risky? Even no-fail businesses do. And when you lose, how will you make ends meet?
Are you planning to invest elsewhere? If so, do the guaranteed returns on this investment beat the discount rate (the reverse interest rate you are being charged to get your cash now)? If not, this is probably a loser. The higher the investment return, the higher your risk.
Annuities are meant to protect you and meet your needs for many years to come. If it disappears, how will you manage? If you can’t answer that question definitively, you probably shouldn’t sell.
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.
