If you’re considering a structured annuity settlement, there are a few things you should know. Structured annuity settlements can provide you with a lump sum of cash that can be used for any purpose, but they also come with some risks.
Before deciding if a structured annuity settlement is right for you, it’s important to understand how they work and what the potential risks are. Here’s what you need to know about structured annuity settlements:
How Structured Annuity Settlements Work
A structured annuity settlement is an agreement between you and an insurance company. Under the terms of the agreement, the insurance company agrees to pay you a lump sum of cash in exchange for your future payments from a personal injury settlement or annuity.
The lump sum of cash you receive from a structured annuity settlement can be used for any purpose, including:
– Paying medical bills
– Replacing lost income
– Funding future medical care
– Supporting your family
– Investing in your future
The amount of money you receive from a structured annuity settlement will depend on a number of factors, including the size of your personal injury settlement or annuity and the current interest rates. Structured annuity settlements are typically only available to people who have received a personal injury settlement or annuity worth $100,000 or more.
Risks Associated With Structured Annuity Settlements
There are a few risks associated with structured annuity settlements, including:
– You may not receive the full value of your personal injury settlement or annuity. The insurance company will take a fee for processing the settlement, and the amount of money you receive will be based on current interest rates.
– Structured annuity settlements are not regulated by the government, which means there is no guarantee that you will receive the money you’re expecting. It’s important to do your research and work with a reputable company when considering a structured annuity settlement.
– There is a risk that you could outlive your Structured Annuity Settlement. If this happens, you would not receive any additional payments from your personal injury settlement or annuity.
Before agreeing to a structured annuity settlement, it’s important to understand the risks and consult with a financial advisor to see if it’s the right option for you.
7 Types of Structured Annuities and How They Work
If you’re considering an annuity settlement, it’s important to understand the different types of annuities and how they work. Structured settlements are one type of annuity that can provide lifelong payments after a personal injury or wrongful death claim. Here’s a look at seven different types of structured settlements and how they work.
1. Immediate Structured Settlement: An immediate structured settlement provides a lump sum payment upfront, followed by periodic payments over time. This type of settlement is typically used for personal injury cases where the victim needs money right away to cover medical expenses and other costs.
2. Structured Settlement with Deferred Payments: A structured settlement with deferred payments does not provide a lump sum up front, but instead offers periodic payments over time that are larger than the immediate structured settlement. This type of settlement is often used in cases where the victim is not able to work and needs long-term financial assistance.
3. Structured Settlement with a Lump Sum and Deferred Payments: A structured settlement with a lump sum and deferred payments offers both a lump sum payment up front as well as periodic payments over time. This type of settlement is often used in cases where the victim needs immediate funds to cover medical expenses, but will also need long-term financial assistance.
4. Structured Settlement with an Immediate Annuity: A structured settlement with an immediate annuity provides a lump sum payment upfront, followed by periodic payments that are made for the rest of the victim’s life. This type of settlement is often used in cases where the victim is not expected to live long or needs financial assistance for a lengthy period of time.
5. Structured Settlement with a Deferred Annuity: A structured settlement with a deferred annuity does not provide a lump sum up front, but instead offers periodic payments over time that are made for the rest of the victim’s life. This type of settlement is often used in cases where the victim is not expected to live long or needs financial assistance for a lengthy period of time.
6. Structured Settlement with a Lump Sum and an Immediate Annuity: A structured settlement with a lump sum and an immediate annuity offers both a lump sum payment up front as well as periodic payments that are made for the rest of the victim’s life. This type of settlement is often used in cases where the victim needs immediate funds to cover medical expenses, but will also need long-term financial assistance.
7. Structured Settlement with a Lump Sum and a Deferred Annuity: A structured settlement with a lump sum and a deferred annuity offers both a lump sum payment up front as well as periodic payments over time that are made for the rest of the victim’s life. This type of settlement is often used in cases where the victim needs immediate funds to cover medical expenses, but will also need long-term financial assistance.
The Benefits of Structured Annuity Settlements
Structured annuity settlements offer a number of benefits for people who have received personal injury awards or judgments. By working with a Structured Settlement Specialist, you can tailor your payments to fit your unique needs, whether you need a lump sum now or would prefer payments spread out over time.
There are two types of structured annuity settlements: immediate and deferred. Immediate annuities begin making payments to you immediately, while deferred annuities allow you to grow your money tax-deferred until you choose to start taking withdrawals.
Some of the benefits of structured annuity settlements include:
-You can receive a lump sum of cash now and still have money coming in for years to come
-Your payments are guaranteed by a highly-rated insurance company
-Your payments can be tailored to fit your unique needs and financial goals
-You can avoid the hassle and expense of managing investments yourself
-Your money grows tax-deferred until you take withdrawals, which means more money in your pocket
If you have received a personal injury award or judgment, working with a Structured Settlement Specialist can help you make the most of your settlement. Contact us today to learn more about how we can help you.
