Structured Settlements have been around for a while but have become legal in the year 1982 when the federal government passed the law. Instead of receiving lump sum amounts for personal injury claims this came as a blessing in disguise for many who did not have the wherewithal of handling huge sums of money and generally spent it wastefully. It provided for making settlements in a structured manner and had flexibility of deferred payments, incremental payments and above all lump sum payments towards the end if so warranted. You might be worried if is it time to sell?
So let us see what the 5 benefits of structured settlements are.
#1 You can get the plan in place
Primarily the settlement amount can be structured in a manner that you wish as permitted by the law. So long as it is legal there will be many takers as it will be free of any complications.
#2 There is no reason to worry about taxes.
Secondly, the amount being settled is tax free at all stages by all the different governments be it federal, local and state. When you realize that you need not pay whopping sums of money as taxes to the government at either one, two or three levels it will automatically be a fringe benefit as money not spent is money earned.
#3 No need to worry about interest
Thirdly the interest on the settlement amount is also tax free. When your money multiplies together with the interest that is accrued due and the same is also exempted from income tax what more can you ask for but opt for structured settlements.
#4 Its automatically taken care off even after death
Fourthly it continues to be given to the designated beneficiaries even after the death of the original recipient. While lump sum money gives you some instant benefit there is obviously reason to smile when structured settlements provides for benefit on a more continual manner making it more attractive.
#5 it’s easier to keep a check on yourself
Fifthly you can cut down on wasteful expenditure by not accepting it as lump sum putting the money to better use. Investing into the future seldom happens when you receive settlement amounts in lump sum as you wish to spend it on items which otherwise you would have not even considered as comfort but would have deemed as luxury. The fact that this is not an option in structured settlements makes it more secure for the recipient as well as those designated beneficiaries too.
You can start off your own journey where you are careful about your earnings and a lot more responsible with your life, when you choose to go in for structured payments. Of course, we can go on and on with the number of benefits that structured settlements bring. After it is being enacted as Law in 1982, it has helped plenty of people pay out their debts in a structured manner and takes lesser tension.