The Cash Now Question.
If you have ever been in a bind for cash you know the stress, the weight of not being able to pay your bills. In these desperate times, desperate measures are often taken. Expensive loans, overused credit cards, and a snowball of events quickly complicate your financial position. Once the collectors begin their relentless pursuit of your sanity, the road to financial prosperity seems a million miles away. On the scene arrives your hero, the “Cash Now” guy.
The “Cash Now” guy says he can buy your lawsuit settlement and give you a lump sum for it. Of course, you have to have a structured settlement; you have to be receiving annuity payments, on top of a myriad of other qualifications. So if you are a lawsuit winner with an annuity settlement, is it really as good as it seems? Can cash now ease your financial woes? Maybe, but maybe not, it all depends on your situation.
The formula is simple. Does solving your money problems today outweigh the price you pay to get an advance on your future annuity payments? For example, paying what equates to a one time 25% interest fee on $30,000 might be worth the price to save your home and avoid bankruptcy. If you are behind on credit cards, which charge you a ridiculous 24% interest rate, does it make sense then to take a lump sum option? What if you had to give up $30,000 of your $75,000 lump sum due in 8 years? Will the $45,000 you get today make up for the 30k throw away?
Annuities and structured settlement suits were created and scheduled to meet the future needs of a recipient. The fee for accelerating those payments is exorbitant. Researching alternative options is a must, and at the end of the day, it is your sanity that makes the final argument. Is cash now an answer to your prayers? Probably not but, it is a choice on your list. And it’s time to get started on that list before your bills get the better of you.
Make a Plan for your Future | Structured Settlement
“Where does all of the money go?”
That is a question a vast number of recipients of structured settlement claims have. The answer is: You need to learn to manage the payments properly. In fact, included in the definition of structured settlements is, it “…provides future payments ‘structured’ over time to meet a person’s ongoing financial needs.”
Do you know how to manage your payments?
In a majority of cases, people who receive a structured settlement plan don’t know enough about the financial world to successfully incorporate their payments into their lives. Everyone knows how fast debt can pile up if you don’t have a personal budget set for your family. The relief that settlement payments can offer can become a burden if you don’t adjust your family budget accordingly. Here are some tips on how to work your payment income into your life.
Make a spending plan.
- Income: Add up your monthly income. This includes any wages, investment income, your structured payments, etc.
- Expenses: Add up monthly expenses. This includes mortgage payments, car payments, credit cards, food, clothing, insurance, etc.
- Include Savings: Don’t forget to pay yourself first. Set aside money for savings. 10% of total income is a good start.
- Do the Math: Subtract income from expenses. If your expenses are higher than your income, you need to trim the extra spending or find a source of additional income.
- Set up a Nest Egg: Plan to set aside money every month. If you will receive large lump sum payments from your settlement, add those to this investment account.
Research into different investment options. Choose the one that best suits your needs.
As stated earlier, the purpose of the structured payments is to meet your ongoing needs. Contact a financial advisor to help you make a plan for your future so your settlement will work for you.
Why sell only half?
Unscrupulous and heartless companies would love to take all your money.
Your problems are not their problems; all that really matters is the price you pay.
In many cases that price is too high. Selling your entirely monthly payment may not be in your best interests.
Many years ago, a structured settlement recipient was doing just fine receiving his monthly payments. When he heard he could get an advance on all his future payments he thought it was a dream come true. Imagine what he could do with hundreds of thousands of dollars. He contacted a structured settlement annuity buyer to sell his future payments. He sold all his future payments, going out 20 years, for about 30 cents on the dollar. His only income at the time was his monthly annuity payments.
Spending Frenzy | Structured Settlement
You’re having a bad week and it’s not getting better. It’s almost Friday and work is weighing heavy on your mind. A friend calls you and asks what you are doing this afternoon. No plans. Let’s go to the mall. Get a coffee. Buy something.
The overall mood of the American household is in decline. In contrast, the economy is up. Recent consumer surveys show that concerns about the economy, mainly high gas prices, have led consumers to shop away their worries. It seems conflicting but many Americans get the overwhelming urge to purchase something when they are depressed or anxious.
The car may need new tires and a tune up- we could buy a new one. You’ve needed a new outfit for work and maybe a pair of shoes. It seems like the current mindset of our economy is an indulgent one. A new government report shows U.S. retail sales increasing by 1.4 percent in April. This is a full percent higher than predicted and a large improvement over a 0.4 percent increase in March.
The shoppers aren’t just at the mall either. Measuring sales in clothing stores and department stores to gas stations, car dealerships and home improvement outlets, the average increase was 1.94 percent.
The concern comes with the ability to pay for the indulgences with the economy still lagging. Gas prices have declined 3 cents per gallon but more relief is not expected or being promised anytime in the near future. Meanwhile, little relief may come from the economic splurging. When the credit card bills come in next month, we’ll see how the national spending has fared.
There is nothing wrong with spending frivolously every once in a while. I certainly had a bad budgeting month too. The important thing is to get back on track with a household budget. If you budget accordingly you will have the extra cash to splurge and not feel guilty about it.
Everyone loves to occasionally impulse buy. Just think about it this way, when you get it home and look at it, you probably wouldn’t have bought it in the first place. It could’ve been overpriced or impractical, but it served a purpose for the day.
Here’s a tip: It’s okay to occasionally impulse buy to make a bad day or week better…just try to keep the cost to a minimum. Think about any major purchases (like a car) before you decide. Give it a day or two. You’ll be happier with your decision in the end.
Whose money is it anyway?
When it comes to your structured settlement, you would assume that you have the power to make your own decisions on how you manage it. After all, you made the choice to have your settlement satisfied by a payment schedule in the first place.
Currently, if you were ever to be in a serious financial bind, you would have the choice to sell all or a portion of your settlement payments to any of a half a dozen major financial companies nationwide. The cost of doing so can be substantial, however, if you have no other options and your situation is dire, you have that right.
All of that may change if the NSSTA (National Structured Settlement Trade Association) accomplishes their goal. They are proposing legislation known as H.R. 4314, which is currently being considered by the House Ways & Means Committee. It’s purpose is to stop all sales of structure settlement payments altogether by imposing a 50% excise tax on the sale of structured settlement payments. What this means is the choice you have now, will no longer be an option.
The insurance companies that support the NSSTA make an incredible amount of money on your structured settlement. When you agreed on a settlement amount for your claim, you were most likely given different options: lump sum payment of a lesser dollar amount or structured payments over a period of time with a greater dollar amount. Often the payments over time pay out more than the lump sum option. This is because the insurance company invests a portion of your total settlement (lump sum) in an investment account called an annuity.
This lump sum will gain interest and over the term of the structured agreement, pay the full amount of the settlement with the interest accrued on the original funds invested by the insurance company.
If H.R. 4314 passes, you will not have the option to sell all or a portion of your payments in a time of need without paying a 50% tax on that money, regardless of the circumstances!
There are things that you can do to protect the right you have to manage your own money. You can find out more information on these topics by contacting your Congressman to voice your opinion at www.congress.org. Speak with a financial advisor or an attorney and do your research online. Protect your rights!
New Chapter in Life
Over 50 and FABULOUS? Who says age means anything, especially these days when the “Baby Boomers” are booming circles around their children? My mother is the perfect example. As the years go by, the higher the bar rises and she kicks it up another notch. She dove right into her own catering business just shy of 50. There is no project she can’t get done and high school Project Graduation is one of her favorite jobs. I, on the other hand, have trouble staying up past ten o’clock on the weekends.
So what’s driving the over 50 population to work tirelessly on their occupations? Some want to accomplish something that they will be remembered for or can pass on to their children. Some are just so used to striving to succeed that they never slow down. Younger, new hires are pushing some out of their jobs with no appreciation or respect for the ladder of seniority. (Someone should probably tell them that he doesn’t like to be called “Pops”) There are many possibilities why the over 50’s generation would choose to rejoin the rat race with a renewed vigor.
From a woman’s standpoint, I have to consider menopause. It’s inevitable. I will become an over-heated, moody woman who is completely impossible to negotiate with. Many women discover fairly soon however, that there is a light at the end of the tunnel.
After the kids are gone and you get over them not calling every day, you discover that you can do what you want now. So they buy a new wardrobe (sometimes a little too scantily clad) take a vacation cruise and come back home with a tan, ready to start a new chapter in life. That realization is liberating.
They weren’t warned of the future of retirees on America like the younger generation. Yet, the over 50 crowd is taking more initiative to secure their retirement than the younger generation. Yes, they are closer to retirement, but it is being reiterated endlessly how important it is to start saving for your retirement now. Control debt. Reduce overspending. Budget and create a savings “nest egg”, yet national debt percentages are still rising. How do we stop the cycle of poor money management?
Consider starting a new chapter in the financial arena of your life. As a structured settlement recipient, you can start fresh by cashing out your annuity. You can pay off the overwhelming debt, take that much needed vacation and come home ready to take on a whole new world of possibilities. Consult a financial planner and an attorney. Take the opportunity to start a new chapter in life with renewed vigor and enthusiasm.
Summertime Vacation
Summertime is on the brink and everyone is making plans for their vacation escape in the sun. The possibilities are endless…a weeklong getaway to the islands, a backpacking expedition through the mountains or an escape to a lakeside cabin where there are no telephones or neighbors. Visions of the much-anticipated summertime travels are in everyone’s imagination. Are your vacation dreams not fitting into your budget? Does it seem like a getaway is out of the question?
Planning ahead by saving now for next year’s vacation escape is a good option, but it doesn’t help you for this summer. Because you are receiving future payments, you have the freedom to get an advance on those payments.
Structured settlements are designed to provide the payment recipient with a certain degree of financial security and assistance. When the payments were originally arranged and agreed upon, they were structured to meet your future needs. However, you cannot always accurately predict what your financial needs will be years down the road. This is a common dilemma for future payment recipients and one that can’t be prevented.
On the other hand, you can sell your annuity to get the cash you need now. You can even just take an advance on a portion of your future payments for that much-needed vacation. You can restructure your payments to meet the needs you have today. The options are endless and can be designed by the requirements you have now instead of the needs you had years ago.
There are financial institutions across the country that specialize in purchasing annuities and/or restructuring them to better suit your needs. You can take that vacation or just get away for a while. Consult a financial professional and an attorney for advice. Contact different financial companies and get quotes for the services that they offer. The fees involved are negotiable and price comparisons are a must. Choose the company that is willing to work with your needs and wants to help you accomplish your goals.
Your structured settlement was put into action in order to meet your future needs. If it is not accomplishing that, you can take back control of your money and make it work for you. Everyone deserves a vacation getaway. Don’t sell yourself short of that without first exploring your options.
Prices Rising
Gas prices are soaring in America with the national average teetering around $2.20 per gallon. There doesn’t seem to be much relief in sight either. President Bush says this crisis took ten years to reach this level and may take that long to resolve. The economy is dragging because the American families are driving less to the mall or weekend getaways. The solution: well if it was a simple one I suppose the government would have jumped on it already.
You can drop $20,000 on a new hybrid fuel-efficient vehicle. Depending on how far you travel to work it might pay off in the long run.
I suppose you could find a new job that is closer to home. That could either solve or create a whole slew of new problems. You may have to sacrifice income, benefits or the overall comfort you’ve established at your workplace.
Why should we have to re-arrange our lives for gas prices in the first place? We have the most powerful government in the world and something as simple as 30 or 40 cents per gallon can dishevel your entire financial state.
As a recipient of future payments you have more options than you may realize. You don’t need to buy a new car or quit your job to find the financial relief you need. You can re-arrange your payments or sell a portion of your annuity.
At the time of settlement, you may not realize the impact the decisions you make will have on your life 5 or 10 years down the line. There is no way to prepare for the unknown or predict what your needs will be years into the future. You can restructure your future payments to meet your needs now. You could also sell all or a portion of a future lump sum payment or a certain number of payments to pay off debt therefore lowering your monthly expenses.
There are quite a few financial companies nationwide who specialize in purchasing future payments. Research into these companies and see what competitive options they have to offer. Most offer free quotes and creative cash now solutions. Consult a financial advisor and an attorney before making any decisions on your structured payments. They were put in place to meet your future financial needs. Make sure your payments work to your benefit.
Does It Ever End?
How often do you ask yourself…“Does it ever end?” The answer to the question is no, not really. So many families today live paycheck to paycheck, barely keeping their nose above water. Being in a financial struggle can be exhausting and destructive in all aspects of your life. With home prices still on the rise and the economy going flat, the “end” we all search for is nothing but a mirage.
There is no true end to bills. Regardless of how much money you have, you still need to make payments to someone for something. Changing the perception of money, bills and other financial obligations is an important step towards financial happiness. If finances were considered an ongoing process that need to be managed and maintained on a weekly basis it would be less overwhelming to take them on all at once. However, the common way of dealing with monetary issues is to avoid them until they absolutely need to be dealt with.
As a structured settlement recipient you have the option to sell your future payments for the cash you need now to relieve your burdens. However, if you don’t have an effective plan for maintaining financial stability after your affairs are settled, you may end up in the same situation you are in right now. It is not uncommon for people with budgeting difficulties to fall back into the clutches of overwhelming debt after obtaining a large sum of money.
It is important to determine where the root of the problem lies. If poor spending habits put you into the position you are in you should consider debt consolidation or setting a structured budget with a financial advisor or consultant. If your debt resulted from unexpected things that were out of your control, consider all of your options before making any decisions on your annuity.
If you have no other source for the money you need, than selling all or a portion of your future payments may be your only option. Realize that the cost of selling your annuity is high. Your settlement was designed to provide consistent income over a period of years. Advancing those payments for a cash solution now will not yield the full amount of your annuity. The annuity’s value is based on the settlement amount plus interest accrued over a period of time.
Consult an attorney and a financial advisor before making any decisions on your annuity. There are financial companies that specialize in purchasing and restructuring settlements and annuities. Negotiate the fees and costs with these different companies to get the best offer possible. You can sell a portion of your payments, your entire annuity or restructure your payments to accommodate your current financial needs.
Once you have researched into your financial situation fully, you will be armed with the information to control it. Everyone makes bad choices at some point in their life and on any given day something completely unexpected can be thrown in our laps. The more knowledge you have about your assets, the more power you have to use them to your benefit.
Cash now for future structured settlement annuity payments.
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