The Settlement Alliance

Are Structured Settlements Beneficial for Claimants of Any Age?

Are Structured Settlements Beneficial for Claimants of Any Age?

Feb 1, 2018

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Structured settlements are an excellent tool for preserving settlement proceeds in a tax-favored financial vehicle. With their flexible design, the injured claimant can select a plan to provide monthly, quarterly, semi-annual or annual payments, and can even schedule a few lump sum payments for larger anticipated expenses. The rate of return is guaranteed1, there are no ongoing fees or expenses, and the payments received by the claimant (including any interest growth) are 100% income tax-free. With all that being said, do structured settlements make sense for claimants of any age? Absolutely. Here’s how:

Minors and Structured Settlements:

Some states require that proceeds from a minor’s settlement be placed into a structured settlement annuity. Even in states where structures are not a requirement, many courts favor them as a safe financial option for minors. If there isn’t an immediate need for the money, the structured settlement can be arranged to begin making payments once the minor reaches the age of majority. If there are immediate needs, the structured settlement can be arranged to pay directly into a trust. Either way, the money will be there when the minor needs it.

Working-Age Adults and Structured Settlements:

Claimants in their 20s and 30s have more financial responsibilities than minors, so a structured settlement may be needed to help cover daily expenses or to replace lost income. If there are no immediate financial needs, future lump sum payments may be scheduled for larger expenses, such as the down payment on a home. Claimants in their 40s and 50s may want to use the structure to help supplement income, fund college for their children, or to round out their retirement plans.

Retirement Age Adults and Structured Settlements:

Adults nearing or at retirement age may welcome the added source of reliable income from a structured settlement. In addition to serving as the bedrock for a diversified retirement plan, a structured settlement can also be used to help cover assisted living and healthcare costs, depending on the needs of the claimant. If the claimant receives needs-based government benefits (e.g., SSI, Medicaid, etc.), the structured settlement can be arranged to pay into a special needs trust, which may help the claimant maintain benefit eligibility.

Contact us to learn more about structured settlements

The comprehensive settlement planners at The Settlement Alliance are well-versed at developing structured settlement plans for claimants of all ages. For more information, contact us today at 800-464-2500 or info@settlement-alliance.com.

1 Guarantees are subject to the claims-paying ability of the issuing insurance agency.

We are proud to partner with the highest rated structured settlement providers in the industry:

  • American general Life Companies
  • Berkshire Hathaway Structured Settlements
  • Liberty Life Assurance Company of Boston
  • MetLife
  • Mutual of Omaha
  • New York Life
  • Pacific Life
  • Prudential