When you are in the middle of a personal injury lawsuit, your mind is constantly on the move with questions about all the possible outcomes of your case. While you may have an experienced personal injury attorney on your side fighting for your right to compensation, it can be difficult to put your mind at ease until the case is fully resolved.
Many people worry about their settlement, and wonder how they will receive their payment in the end. Questions like, “Will I get all my money at once?” and “Is it possible that my compensation will be provided as a structured payment?” all of the common concerns by most personal injury plaintiffs.
Structured Settlement
A structured settlement is an agreed periodic payment plan in which the beneficiary receives a certain amount of money over a certain period of time; and they are a common result of resolving personal injuries. There are advantages and disadvantages to structured payouts, depending on your particular perspective.
The number one benefit of structured settlements is that you usually receive more money overall. In a lump sum payment, the amount is usually negotiated lower. Another major benefit is personal financial management. When large sums of money are paid overtime, it is usually easier to manage your finances, pay bills, save money, and maintain a positive financial portfolio. This may be very beneficial in terms of tax liability as well.
Additional advantages:
- Simpler Tax Planning
- Possible Income Tax Advantage
- Additional Annual Income
- Wider Subsidy Opportunities
- Budget Protection
One of the common downsides to paying structures is the limitations. For those who consider themselves financially savvy, not receiving your full compensation can be a huge limitation because you cannot use the money to make profitable investments. In other cases, the victim of personal injury has paid all hospital bills, medical expenses, and other related expenses, directly. They have also lost wages from work; so not receiving full payment can be frustrating as victims in these situations are just trying to get the money back where it was before their accident.
Structured Settlement Results
If you win your claim and the insurance company agrees to provide you with a structured settlement, you will not be paid a salary immediately. In exchange, you will be paid a certain amount over a certain period of time. The terms of a structured settlement agreement vary from case to case, and the amount and schedule of payments can be set in a variety of ways. This payment usually begins as soon as all documents are processed; however, this timeframe can vary, and it can sometimes take up to a year to start receiving payments.