The Advantages of a Structured Settlement Annuity

Through a structured settlement annuity, you receive regular payments for a set period on a previous legal settlement as opposed to receiving your settlement payment in a lump sum. Although you may prefer a one-time payout, there are distinct advantages to collecting your settlement through an annuity.

Future Financial Security

You’re guaranteed to continue receiving settlement payments until your settlement is paid in full. Therefore, even if you lose your job or suffer from other circumstances that could cause financial hardship, your settlement payments will continue to arrive and provide a monthly income, however moderate, that you can depend on.

Tax Relief

Your structured settlement annuity payments can be structured so as to help you avoid, and in some cases eliminate, your tax obligation toward the full settlement amount. Thus, you receive more money over time than you would have if you’d been paid in a lump sum and deducted taxes from the total amount.

Offsets Poor Debt Management Skills

If you don’t have the best history managing your debts, a structured settlement annuity is in your best interest because it forces you to spend your settlement money moderately rather than extravagantly.

Protection from Relatives

Almost everyone has a few family members who are selfish, greedy or struggling financially. A structured settlement annuity prevents you from having to fend off relatives who want you to help them pay off their debts, buy a new car or provide alternate forms of financial support.

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