Disadvantages of Structured Settlements
The inflexibility of a structured settlement can be a major disadvantage. If a situation arises where you need to access a large amount of cash, you can't turn to your structured annuity for it, unless you are willing to sell all or part of it. A structured settlement can be advantageous as it does not allow the funds to dissipate. However, being able to access your money when you want, can weigh heavily in such a case.
In addition, there are those individuals who have a tolerance for market risk, and are smart investors that can make many beneficial decisions with a lump sum of cash. Every day there are people who enter into structured settlement agreements. Most often the idea of installments over a long period of time at the time of settlement seems like a really good idea. Things change. Sometimes it may be unexpected medical or legal expenses or a death in the family. Other times individuals will find themselves needing the money to buy a house or fund college tuition. Structured settlements don't make provisions for such circumstances.
Selling Future Annuity Payments
Many individuals want to sell future payments from their annuities in order to cover expenses such as college tuition, opening a business or paying off bills. There are also others who understand the time value of money and will want to take advantage of a lucrative investment opportunity. Whatever the reason, more and more people are choosing to sell future annuity payments rather than wait for future dollars to be eaten away by inflation. You should be aware however that it will take at least 90 days to complete the process of selling future payments from your annuity. Beware of anyone that claims it will take less time!
The law now requires that a court order be obtained that will approve the transfer of payment rights prior to accessing the money, and that does take time. This court process has both advantages and disadvantages. The advantage is that your transaction is reviewed by a judge to ensure that you are receiving a fair amount on your annuity and that any remaining payments that are not sold, will be protected. The only real disadvantage, is that it takes some time to complete the whole process.
تعليقات
إرسال تعليق