What Is a Structured Settlement?
A structured settlement is a financial or insurance arrangement, including periodic payments, that a plaintiff receives after winning a physical injury or wrongful death case. Structured settlements were first used in the United States and Canada during the 1970s as an alternative to lump sum settlements.
In the United States, structured settlement laws and regulations exist at both the federal and state levels. Federal structured settlement laws include sections of the Internal Revenue Code while state laws include periodic payment of judgment statutes. Medicaid and Medicare laws and regulations affect structured settlements.
Structured Settlement vs. Lump Sum
Structured settlements have been endorsed by many of the nation’s most influential disability rights organizations, including the American Association of People with Disabilities and the National Organization on Disability. This is probably because structured settlements ensure tax-free income tailored to fit a claimant’s specific needs.
Furthermore, structured settlements can improve a claimant’s financial security by reducing the risk of losing a lump sum through poor financial choices.
Can I Get an “Advance” on a Structured Settlement?
Though sometimes unforeseen emergencies demand a sum greater than a single periodic payout cannot cover. Fortunately, there are companies like Woodbridge Investments that can buy a number of your structured settlements for a lump sum large enough to help you in your time of need.
Let us know if you need help figuring out what to do with your structured settlement. Our advisors are always here to help!
