Structured settlements are typically set up to pay out through an annuity that is. This allows the plaintiff to receive the money owed to them through periodic payments that are typically tax free. Below are a few of the annuity arrangements that exist.
Deferred Income Annuity
Many deferred income annuities can postpone the annuitant’s income stream for years, so clearly this is not a good solution for everyone. However, should the plaintiff of a structured settlement be in a position to comfortably wait for their payments to start, these annuities typically offer higher payments the longer you push back the start.
Fixed Index Annuity
Fixed Index Annuities can be a great long term financial tool. When referring to structured settlements they can allow for tax-free or tax-deferred growth of the principal of the annuity. It allows the annuitant to participate in and see financial growth from the market index, without putting the principal at risk. There are also optional benefits that can be put in place to further protect the income. It is a great way to participate in the market without the risk.
Market Based Structured Settlements
These types of structured settlements allow for the plaintiff to utilize investment portfolio’s instead of an annuity. Basically, this allows the individual to invest the monies they were award in the market in the hopes of receiving favorable returns from that money. It is always recommended that the individual has their market based structured settlement managed by a professional, highly regarded investment firm.
Single Premium Immediate Annuity
An SPIA is an annuity that is purchased with a single large payment done upfront. Typically, these annuities are considered less complex than other types of structured settlement annuities and the payments kick in quickly. If you have a fixed interest rate set up your annuity will not be impacted by the market.
Have a Structured Settlement and Need Cash Now?
As is the case with most structured settlements should the annuitant find themselves in a position where they need a lump sum of cash immediately they can try to sell a structured settlement. They would need to reach out to the best structured settlement companies, like We Pay More Funding, and tell them “I want to sell my structured settlement”. The factoring companies will then review their settlement arrangement and make an offer for all or some of the future structured settlement payments.