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Injury Victims And Structured Settlement Annuities


It can be devastating psychologically, physically, and financially when you are injured because of someone else's mistake and are not able to get on with your life as you used to before. This is a time when you need to take action and receive compensation for your trauma through a personal injury lawsuit. This is when structured settlement annuities are used. They are designed to provide the victim or the victim's family with regular funds to meet medical expenditures as well as other expenses. Instead of one hefty payment, they opt for an annuity that is tax-free as they are not liable for federal and state income taxes. Payments can be made annually with a fixed sum or in lump sum installments over a period of years.

Advantages Of Structured Settlement Annuities Against A Lump Sum Settlement

In most cases, injury victims benefit from choosing structured settlement annuities in that they are assured of a guaranteed amount to be paid at regular intervals and in most cases if they are not tax-free they are tax-deferred. It is easier to manage and utilize installment payments rather than receive a hefty sum that may get exhausted because of mismanagement and bad investments. This method ensures that they are not worried by how to invest the lump sum awarded to them but instead frees them to concentrate on healthcare and rehabilitation. With lump sum investments, they need financial advisors who may turn out to be costly. This kind of annuity is useful in cases when a victim dies leaving behind children, or when the damage is so bad that they need prolonged and expensive treatments.

Be very careful while accepting structured settlement annuities as they are rigid and once you accept it, it cannot be changed in any way. Shop around, learn the details including fine prints if any and then decide on a policy that suits your needs. You may choose to get payments monthly, quarterly, or annually and it may be a fixed period annuity or a lifetime annuity. Carefully, accurately estimate your current expenditure as well as your expenses in the future and select the right structured settlement annuities.

 

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