If you’ve been hurt in a car accident in Austin, Texas, and have won a settlement, you may have a couple options regarding how your settlement is to be paid. Victims of car and truck accidents can choose between having their settlement money paid in a lump sum amount or as a structured settlement. What’s the difference, and which option is best for you? It largely depends on your settlement, your long-term needs, and your ability to financially plan for the future. A lump sum personal injury settlement is the most common type of settlement payment. With a lump sum payment, your settlement amount is paid in full. However, with a structured settlement, the negligent party will take your settlement amount, purchase an annuity, and then you’ll be paid periodically from this amount. A structured settlement works best for situations where the personal injury settlement is likely to be substantial and where families would prefer to get an “income” of regular bi-monthly or monthly payments to cover living expenses, medical costs, and other costs.
Not all personal injury settlement award amounts will lend themselves to the structured settlement model. Smaller personal injury awards will generally always be paid as a lump sum payment. But, if you stand to receive a significant award, a structured settlement may be an option. If you were seriously injured, suffered a spinal cord injury, traumatic brain injury, back injury, neck injury, or other serious and life-altering injury, your settlement amount may be significant. If this is the case, your long-term needs may be immense. You may need money to cover lost wages due to disability, may need money to cover medical expenses, and ongoing nursing care and other needs. A structured settlement can be an arrangement that ensures that for your lifetime, or for a long period of time, you’ll receive regular payments to cover your costs.
The amount of money you’ll receive regularly with a structured settlement will depend on several factors. It will depend on the settlement amount you received, it will depend on how much money you’ll require on a regular basis to maintain a standard of living, and it will depend on how long you estimate you’ll live. Many individuals hire a financial planner to help them manage their personal injury settlement, especially when the settlement is designed to help a victim cover costs and losses that are likely to last a lifetime.
A structured settlement is a good option for families who are concerned about spending their personal injury settlement too quickly. Another option families might have is to set up a trust or to invest their personal injury settlement, but with financial uncertainty due to COVID-19 families are wise to hire financial planners to help them navigate these issues, if this is the choice they want to make.
The Robson Law Firm is a car accident law firm in Austin, Texas that works with personal injury victims, helping them seek the damages they may deserve under the law following an injury or accident. You may only have a limited amount of time under the law to seek damages for your losses. Reach out to the Robson Law Firm today or connect with USAttorneys.com to get matched with a lawyer at the Robson Law Firm.