Like all life-altering decisions, choosing whether or not a structured settlement buyout is right for you involves a lot of consideration and research. During this time, you’ll undoubtedly weigh the pros and cons of selling your structured settlement. If you’re in serious need of a lump sum of cash, perhaps money today is more important than future payments. It may make more sense for you to pay off your mortgage today or pay the balance of high interest credit cards than make monthly payments while your debt continues to accrue interest.
Selling structured settlements should improve your quality of life, long-term, i.e., you don’t want the money to buy a new, fully loaded BMW or take a trip to Bali. Instead, about how much you rely on those payments to make ends meet. Only you understand the present need for cash, but don’t forget to consider future financial obligations.
Pros to Selling Your Structured Settlement
Many people decide to sell all or part of their structured settlement to get squared on their debts. Whether you want to pay off a mortgage, medical bills, credit card debt, or student loans, obtaining money today will help avoid accruing interest and owing more in the long run. Here are a few scenarios where you can benefit from selling your structured settlement:
- You receive a lump sum within weeks instead of years. If you have a structured settlement or an annuity and need a quick cash infusion, a buyout may be right for you.
- Pay off debts, especially those with high interest rates. Don’t throw money away paying more interest and less principle. By paying off current debts from your structured settlement buyout, you’ll be freeing up money for the future.
- You can invest a lump sum, and yield better interest. Since inflation will affect the value of your structured settlement, investing in a business or other venture may lead to more financial stability.
Cons to Selling Your Structured Settlement
Making a well-informed decision requires acknowledging both the advantages and disadvantages, and choosing to sell your structured settlement is no different. Below are a few reasons why a structured settlement buyout is not for you:
- You are selling future payments at a discount. It’s important to understand you won’t be receiving the full amount for your structured settlement. This is how the company you work with makes money. Inflation will somewhat decrease the value of your settlement over time as well. If you invest or spend the lump sum wisely, you will see a better return.
- You may make unwise investments or purchases. Selling all or part of your structured settlement is like taking away a safety net for those who rely on the money for bills and daily living expenses. If you blow money on unnecessary wants, the outlook of your financial future will look bleak.
It’s up to you to weigh the pros and cons of selling your structured settlement. Understand your case is unique from everyone else’s; only you know the circumstances and sense of urgency for your particular situation. Though everyone needs money for different reasons, the end goal should always be working towards a more stable financial life. At RSL Funding, we partner with people like you every day and our specialists are available to assist you through this transaction. For a free quote to determine if selling your structured settlement is the right choice for you, fill out the quote form or call RSL Funding at web_phone.
