Want More Client Referrals? Try this Strategy

Every attorney recognizes the importance of a strong referral base. In addition to decreasing your advertising budget, a steady stream of client referrals generates a ready source of financial stability. A 2019 Legal Trends Report revealed that 59% of law firm clients sought referrals from someone they knew or with whom they had been in contact, making it critical for law firms to create a positive client experience.

How can you ensure satisfied clients without any additional burden on your firm’s financial and human resources? By leveraging settlement consulting services to provide solutions that meet your clients’ unique needs.

Higher Net Worth Clients

High net worth individuals often share the same goals: income preservation and tax burden minimization. A life-altering injury adds a level of complexity with endless financial implications. The best strategy will depend on the severity of the claimant’s injuries, outstanding liens, Medicare eligibility, and future needs and goals.

A few common considerations are:

Structured settlement annuity: While many income tax advantages phase out as wealth increases, structured settlement annuities are different. A structured settlement annuity provides the opportunity to place an unlimited amount of settlement proceeds in a safe financial vehicle, where it grows income tax-free and provides guaranteed¹ tax-free income.

Market-based structured settlement: Higher net worth claimants often have more flexibility in terms of investment options. A market-based structured settlement provides income tax-free payments while also allowing for market participation. A market-based structured settlement can be incorporated into an existing financial portfolio and can be managed by the claimant’s financial advisor or a reputable financial institution.

Medicare Set-Aside: Despite having potentially paid more into Medicare than lower-income individuals, high net worth claimants must still consider Medicare’s interests when a settlement involves funds for future medicals. Your client may need guidance regarding the need for a Medicare Set-Aside (MSA), the proper allocation, and MSA administration options. Improperly addressing funds for future medicals could result in stiff penalties from Medicare for both the claimant and the attorney.

Lower Net Worth Clients

Settlement proceeds present numerous issues for lower net worth claimants. A settlement represents the largest sum of money that many claimants have dealt with at one time, leaving many unprepared to handle the proceeds in the most advantageous manner.

Government benefit preservation: Low net worth claimants may be relying on needs-based government benefits (e.g., Medicaid, SSI, etc.). Accepting the settlement proceeds in a lump sum will exceed the income and asset thresholds associated with these types of benefits, rendering your client ineligible. Your settlement consultant will work with the claimant to determine which benefits may be affected and how to protect eligibility.

Special needs trust: A special needs trust (SNT) is often the vehicle of choice for protecting needs-based government benefits. By placing the settlement proceeds in an SNT, the injured claimant can continue receiving needs-based benefits while supplementing their needs with trust distributions. Pooled special needs trusts are another possibility for claimants for whom a first-party SNT may be cost- or age-prohibitive.

Structured settlement: One of the greatest benefits of a structured settlement is the ability to preserve income for the long-term, rather than suffering the consequences of poor financial decisions. Claimants can choose the amount and timing of the periodic payments, helping to ensure that the settlement money will be there when it’s needed.

Ready to Impress Your Clients? Contact Sage Settlement Consulting

The biggest key to happy clients? Education. A client making informed decisions about settlement proceeds is a client who can confidently refer you to their friends and family. For more information about our wide range of settlement solutions, contact Sage Settlement Consulting today.