One of the questions that most people have when considering a structured settlement annuity payment is how exactly will it work?
There are many different options that you can choose from when setting up a structured settlement, hence the term “structured settlement”. This is by far the most popular option when receiving a judgment or settlement from a lawsuit, auto accident settlement or workers compensation claim.
But, how exactly do the annuity payments work? What are your options with the structured settlement annuity payments?
First, you need to consider a couple of things about yourself and your current financial condition. The payments you will receive are usually guaranteed for a certain amount of time. Most of the time 30 years is the average. So, you need to consider your age. If you are older and 30 years will extend beyond your life expectancy, you might want to consider a shorter term or different structure option.
Another consideration is what current and future medical expenses do you anticipate? Did you know that you can also plan into your structured settlement annuity payments for lump sum payments? If you know in 10 years you will need a new wheelchair, for example, you can factor a lump sum payment in 10 years that will cover the cost.
Many times the payments that you receive from the structured settlement are going to be a fixed monthly amount. There can be some variances based upon the exact terms that you put into the annuity, like lump sums, length of terms and beneficiary.
Once the annuity is purchased, your payments will begin. You can set it up to have the money directly deposited into your account, or you can have a check mailed to you.
Another consideration about the structured settlement payments that you need to think about is the length of term that the payments will be for. You can make the payments guaranteed income for a set term of years, but sometimes the option is there for them to continue beyond that guaranteed period if the person that is receiving the payments is still alive.
The guaranteed annuity payments are fixed income for the life of the annuity. There are so many different ways to set up the structured settlement annuity payments that when you are considering this, the possibilities are almost unlimited.