Injured Claimants' Top 3 Settlement Questions
A settlement may represent the closure of one chapter, but it also opens up a new, more confusing one. By being aware of typical settlement-related questions and bringing in appropriate experts to help, you can help create a continuum of care for your clients, leading to a stronger referral base for the future.
Here are the top three questions our team receives:
#1: What is the fastest way to receive my money?
Some may harbor the misconception that a cash lump sum provides faster payment than a structured settlement. In reality, many people choose to design tax-advantaged structured settlement arrangements with an up-front cash payment, followed by a series of periodic payments. The periodic payments can be scheduled to fit the needs of the claimant, whether that means monthly, quarterly, bi-annual, or annual payments, or even as a series of future lump sums to pay for larger expenses, such as college tuition or retirement.
As long as the required forms and documents are submitted promptly, the claimant should have the up-front cash payment when it is needed. Don’t forget that if the claimant wants to structure, the decision must be made prior to finalizing the settlement agreement.
#2: I’ve never sought professional financial advice. Who can I trust with my money?
Allowing the claimant to search for financial advice after receiving a large settlement is a surefire way to open them up to predatory financial practices. While there are certainly experienced, committed advisors out there, claimants often fall victim to “friends” and family asking for a handout and “advisors” looking to benefit by taking advantage of inexperienced investors.
Engaging an experienced settlement planner early in the litigation process can help the claimant feel assured that they have a financial advocate and a customized plan in place to meet their short and long-term needs.
#3: Will the settlement affect my government benefits?
With all of the current discussion surrounding the overhaul of the Affordable Care Act, government benefits are a hot topic. All settlements, whether large or small, can be quickly depleted by medical costs, so maintaining eligibility for needs-based programs such as Medicaid, SSI, food stamps, and subsidized housing is imperative. The acceptance of a lump sum settlement would likely render a claimant ineligible for these types of benefits due to income and asset limits. Fortunately, there are certain financial tools, such as special needs trusts, that may help the claimant preserve both their benefits and their settlement proceeds.
Contact Sage Settlement Consulting today
Don’t let your hard work securing a settlement go to waste. Contact an expert settlement consultant at Sage today to help ensure that each of your clients has a plan in place to move forward post-settlement.
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