Is Selling A Structured Settlement A Good Idea
In many cases, when people receive a legal settlement, they don’t receive one lump sum. Instead, they get a structured settlement. This entitles them to payments over a long period of time.
If you’re in this situation, and you need cash, you may be thinking about selling your structured settlement. However, before you sell your settlement, you need to make sure that this is the best choice for you.
See What The Surrender Charges Are
If you agreed to a structured settlement, and you decide to sell that settlement off, you are probably going to have to pay surrender chargers. Depending on the terms of your settlement, you may have to surrender as much as 10% of your settlement.
If you need cash right now, selling your settlement might be worth the cost. However, if you aren’t in a desperate situation, you might want to stick with your current situation instead.
Look Into Tax Penalties
If you do wind up selling your settlement, it could wind up costing you later on. If you are 59 or younger, it is likely that you will have to pay tax penalties on the money that you receive.
If you are counting on your tax refund at the end of the year, you should know that your annuity is going to eat into it. Receiving a lump settlement could cause your taxes to significantly increase.
You don’t want to be surprised when it comes time to file your taxes. You should make sure that you are aware of how your settlement will be impacting your taxes.
Find The Right Buyer
If you are confident that selling your settlement is the right choice for you, you are going to have to find the right buyer. You should seek out a buyer that has a lot of experience with buying structured settlement payments.
When you work with the right buyer, you’ll be able to ask questions and get the information you need easily. In addition, your buyer should help you to keep the money you need right away.
If you are in a bad place, and you need to get money now, working with the right kind of buyer will really improve your situation.
Have A Plan In Place
A lot of people go overboard when they receive their lump payment. Because most people aren’t used to having access to those kinds of funds, a lot of people are able to go through their cash very quickly.
You should try to have some sort of plan in place for your money. Don’t spend recklessly; make sure you are going to be using your money wisely.
If you sell your structured settlement, you won’t be able to receive any additional payments in the future. You will have to make your money last.
Ultimately, only you can decide whether or not selling a structured settlement is the right choice for you. With that said, a lot of people have had positive experiences selling their settlement. You might have a positive experience too.