Understanding Structured Settlements: What You Should Know
More than $6 million is paid each year to fund new structured settlements — with the average structured settlement payout being around $324,000 — and yet despite the fact that so many new structured settlements are paid out, few people really, truly understand what they are. Here’s what you should know.
What Are Structured Settlements, Anyways?
Structured settlements are a way to pay an individual a large sum of money, and are sometimes referred to as annuities. In most cases, structured settlements are agreements between an injury victim, and the defendant or an insurer. In a structured settlement, the recipient does not receive the money in one, large, lump sum, but rather in smaller payments that are usually tailored to meet the medical expenses of the victim, and/or the victim’s basic living needs.
Why Get a Structured Settlement?
Structured settlements provide several different key advantages. First of all, they can be arranged to be invested on the recipient’s behalf, and distributed tax-free. Second, they can meet the long-term rehabilitation of the recipient, or their permanent care expenses. In other words, they can take care of past, present, and future medical expenses. Third, they can cover future costs of living, such as college tuition, a down payment on a home, retirement, or even mortgage payments. Basically, a structured settlement is a great way to relieve the burden of managing money to meet needs, and provide long-term financial security.
Can You Get Cash For Your Settlement?
The short answer is yes, you can get cash for settlements. Life happens, and when it does, it can cost a pretty penny. Sometimes, the money from a structured settlement just isn’t enough to cover the expense, which is why some people decide to sell structured settlement payments, to get cash for settlement so that they can cover whatever unexpected costs may arise. Now, selling a structured settlement may not sound like a good idea, but believe it or not, 92% of claimants who sell their structured settlement are satisfied with their decision.
If you have any questions, feel free to share in the comments.