It is fun to have the opportunity to make a decision between two good options. Making the choice between a structured settlement or a lump sum payment is one of those times. While both options mean that the person making the decision is the recipient of a fairly large amount of money that they have received from a lottery payout or some kind of court settlement, the decision about what to do with that money can seem challenging.
A February 2017 article in The New York Times Magazine indicated that for the first time in history major corporations are holding large amounts of cash. The amount that the article indicated was being stashed away was nearly $2 trillion. The writer went on to say that both economists and historians are puzzled about why, for the first time in history, these large companies are stockpiling their money. Although the answer may not be easy to determine, if the largest corporations are for the first time in history deciding to hoard cash, could that possibly mean that as citizens we too should reduce our debts and save as much as we can?
It Is So Fun to Dream
Here is a list of some of the things you could do If you took a lump sum payout for your annuity settlement:
- Pay off all of your debt. The place to start, of course, is with high interest credit card balances. It is difficult to achieve your dreams if you have a large amount of high interest debt. Just making the minimum payments virtually insures that you will never pay off the balance. did you know, for example, that the average adult in America owes $3,761 in revolving credit to lenders. Taking a lump sum from an annuity settlement means that you will have the power to erase this debt.
- Pay for college tuition. Whether you use your cash for your settlement to pay to finish a degree for yourself or a degree for your son or daughter, investing in education is a great goal. The average American adult owes nearly $11,000 in student loan debt. While a college education is essential in getting a good paying job, it is a burden to start even the best job with so much college tuition debt. If, however, you could pay for a college degree with the money from an annuity settlement, you could make greater progress in your new career and life.
- Pay off a home loan. The secret to a successful retirement is the elimination of debt. If you have no other credit card debt, it might be time to pay off a house loan. Being able to use money that was previously ear marked for house payments as money to save and invest can make the vision of your retirement your years seem much more hopeful.
- Buy a second home. If you have access to getting cash for structured settlement money now, and you have no home loan or other debt, you might consider buying a second home. Many vacation hot spots are perfect locations for a second home. Being able to spend cold winter months, for example, in a warm place without having to pay for rentals or hotels is a great advantage.
- Take a dream vacation. Life can be a challenge, and if you are in the fortunate spot where you have no debt but have access to money from an annuity settlement, it might be time to treat yourself to a dream vacation. Can you imagine the fun of taking your family on an Alaskan cruise? A trip to Europe? If you have paid off all of your debt, take some time to use your money to spend quality time with the people you love.
In the last calendar year, student loan debt grew from $1.21 trillion to $1.3 trillion. The debt of individuals and the debt of our nation threatens to cripple every aspect of the American economy. Maybe it is time to take the cash from your annuity settlement and copy the latest trend of the biggest corporations. Pay off all of your debt and start saving for the future.