If you’ve received a structured settlement annuity due to settling a lawsuit or winning the lotto, you may want to have access to a lump sum rather than spreading it out over a number of years–or the course of your lifetime.
If and when you decide to sell your annuity, it’s important to know that there may be a surrender charge of up to 10%. Even with this potential charge, 92% of those claimants that sold their structured settlement have been satisfied with the outcome.
An Overview of How Lotto Annuities Are Dispersed
If you won the Mega Million, you will receive an immediate payment. Even though each subsequent payment will increase by 5%, the remainder will be paid out over 29 years. The Powerball annuity, which also increases over time, is paid out over 30 years.
You can expect to have 25% of your total lotto winnings withheld for federal taxes. Depending on your current tax bracket, as well as which state you reside in, state taxes will range from 6-to-9%.
Why Should I Sell My Structured Settlement Annuity?
Since you want a secure financial future, selling your annuity can assist with attaining this goal. This may be even more important if your current financial circumstances are tenuous. If you’re in the process of deciding to sell your annuity in lieu of receiving structured settlement annuity benefits, you may want to consider whether any of these situations apply to you.
- Credit card debt
- Unpaid household bills
- Outstanding personal loans
- Cost-of-living increase
- Student loan debt
- Other types of debt
- Unemployed or under-employed
Some National Figures
If you responded in the affirmative to any of the above situations, then you’re not alone. If you’re between the ages of 18-to-24, did you know that one-in-five individuals within your age bracket claim to be experiencing hardship?
While there has been an increase in household income over the past 12 years, the cost of living has surpassed it. To be more specific, the cost of living has been reported as 3% higher than the 26% increase in income. Furthermore, the average household has a total debt of $129,579.
If you have credit card debt, did you know that the average person has 3.5 credit cards? Given those households with credit card debt, the average amount owed is $15,355.
Do you have outstanding bills? In the United States, 26% claim they do not pay their bills on time. In a recent survey, it was found that only 37.4 percent of credit card holders do pay their full balance on a monthly basis. The survey also showed that 15.9 percent paid just the minimum balance.
Taking an Honest Look at Your Financial Situation
Should I sell my structured settlement annuity? If you are in the process of taking an honest look at your personal finances and realize that it would be beneficial to opt for a lump sum, you may want to seriously consider selling your structured settlement. Just imagine the relief you’ll feel if you’re in minor-to-major debt. Just imagine being able to finally purchase your first home, buy a new car or take a real vacation.
If you still aren’t sure how to answer the question–should I sell my structured settlement annuity?–considering setting up a consultation to learn more about your options.