Structure settlement?

Question

Hi,

I’m going to be 18 in a week and a half so I’m wondering how I go about getting my money? I am just reading the paperwork from my con artist attorney that states to give me 400.00 a month for ten years. How can I request a lump sum?

Thanks for any info you can give.

Answer 1

OlderAndWiser | 582 opinions shared on Education & Career topic.

Master

1. The reason for a structure is that when an 18 year old gets control of $20,000 or more, it is soon spent with very little to show for it. People you barely know will want to be your best friend. . . until they have helped you spend all the money.

2. The structure you describe sounds like an annuity. Determine what company has provided the annuity and ask them if they have an option for early cash settlement or withdrawal from the annuity. If not, there are many companies which will purchase your annuity - if it is assignable - and give you a lump sum of cash, and then they will collect the $400 per month for the next 10 years.

3. Whatever lump sum you are offered with be far less than $400/mo X 120 months = $48,000. That is because the right to receive $400 10 years from now is not worth $400 today. If I gave you $300 today and you invested that at 3% interest per year, in 10 years you would have approximately 400 dollars. Calculating how much money you need to have now so that, properly invested, it will yield a certain amount in the future is called reducing it to present value.

Additionally, anyone who engages in the process of purchasing annuities assumes a risk that the company obligated to pay the annuity may go insolvent in the next 10 years, and such companies also want to make a profit on these transactions. Therefore, don't be surprised if you are offered as little as $20,000 as a cash buyout for this annuity. My advice is to leave the annuity as it is and receive an extra $400/mo. Or, if you are really disciplined, ask the annuity company if you could use the value of the current annuity to convert to an annuity that would start paying you a monthly income at age 65. They may offer you an annuity that would pay you $3,000-3,500 per month, beginning at age 65 and continuing for the rest of your life.

Or you can do what other kids do. Cash in the annuity, buy a car which will impress the girls, have parties, take a trip, realize that all the money is gone, sell the car because you haven't bothered to get a job and have no income, and you have nothing left to show for the payment.

Asker

16 d
Thank you,

It would have been easier if they would have given me a little more than 400 income limit. I was the one hurt not my attorney. 725.00 a month is better than 400.00 a month.

The company is a life insurance agent and says they only distribute the money, and says I have to go back to my attorney because it’s a court order. I’m assuming it would take me going back to court to change the request.

Thank you for your help!
OlderAndWiser

16 d
$725 per month would have ended after 5 years instead of 10 years.

I think that what the insurance company is telling you is wrong.
Asker

16 d
Ok,

I will try calling them again tomorrow. Because it’s court ordered, they aren’t able to make changes. I would assume turning 18, I should have a say in this.
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OlderAndWiser

16 d
Yes the court order should only apply until you reach age 18.
OlderAndWiser

15 d
Thanks for MHO!
Asker

14 d
You’re welcome!
Asker

14 d
Thank you!

Answer 2

Asker

Thank you,

It would have been easier if they would have given me a little more than 400 income limit. I was the one hurt not my attorney. 725.00 a month is better than 400.00 a month.

The company is a life insurance agent and says they only distribute the money, and says I have to go back to my attorney because it’s a court order. I’m assuming it would take me going back to court to change the request.

Thank you for your help!

Answer 3

OlderAndWiser

$725 per month would have ended after 5 years instead of 10 years.

I think that what the insurance company is telling you is wrong.

Answer 4

Asker

Ok,

I will try calling them again tomorrow. Because it’s court ordered, they aren’t able to make changes. I would assume turning 18, I should have a say in this.

Answer 5

OlderAndWiser

Yes the court order should only apply until you reach age 18.

Answer 6

OlderAndWiser

Thanks for MHO!

Answer 7

Asker

You’re welcome!

Answer 8

Asker

Thank you!

Answer 9

Agape93 | 368 opinions shared on Education & Career topic.

Master

@OlderAndWiser

Structure settlement?

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