Have you ever taken a lawsuit versus a business or perhaps
In most cases, if you win a lawsuit or resolve your court case the offender is required to pay you the judgment or settlement amount in a lump sum. Let's suppose, as an illustration, you have a form of cancer caused by asbestos known as asbestosis. You take legal action against the asbestos maker, who agrees to settle outside the court for a million dollars. You get a check for a million dollars, right?
That is one option, but a structured settlement might make more sense dependant upon your situation. A structured settlement annuity pays you in installments over time rather than a single lump sum payment. Installments can be structured in a number of approaches to meet your requirements and to allow you to evade inflation. They may range from an ordinary annual payment to sophisticated arrangements made up of an initial lump sum payment, month to month indexed installments, deferred payments, as well as exclusive provisions relating to the future care or death of the person covered.
What are the advantages of a structured settlement ? One of the benefits is that you're guaranteed a source in cash flow for life. The second essential advantage is tax management: you might be able to significantly lessen the taxes you should pay Uncle Sam on any investment income that would otherwise amass from investment of a single settlement .
Besides the tax savings, it is also vital that you "know thy self" when making a decision about structured settlements . Are you the kind of person who would go to Nevada, do some world travel, buy lots of toys, and basically blow your money till you have nothing left ? If so, a structured settlement annuity may be the best alternative.
There are a few disadvantages, however, that you need to pay attention to. First of all, once you accept it, you're stuck with the terms of the structured settlement . You can't change it at some later date. Hence, it's extremely important to be represented by a good attorney and tax consultant who will help make a deal for structured settlement terms that suit your needs, including defense against rising inflation. If you don't expect to live for a long time, however, you may choose a settlement that ensures a minimum payment even if you die before the guarantee time period runs out. This can guard your family or beneficiaries from being left without having economic assets.
Though a structured settlement is not ideal for all people, they could be very helpful, dependant upon your requirements. Your lawyer or attorney can help you in assessing whether they are appropriate for you. About the Author
