If you have done what many people dream of doing by winning the lottery or a giant lawsuit, you may have questions about the money you will receive. Many people do not realize that most of the time, money from lawsuits or lottery jackpots is paid out over a long time. This is one reasons that playing the lottery is considered to be the most popular way to gamble. For example, if someone wins the Mega Millions jackpot and the full amount is $50 million, that person does not get one lump sum payment. They will receive on payment for $750,000 and then a single payment every year for about 29 years (each check will be for about 5% more than the one they got the year before). That is not a bad amount of money but many people prefer to get more of their money sooner. They wonder about how to get money from a settlement now so that they do not have to wait years and years.
First, talk to a trusted financial advisor about how to get money from a settlement now. Go over your finances and what the tax consequences will be.
Here is How to Get money from a Settlement Now:
Next, you need to think about your reasons for selling. Why do you want to sell your structured settlement of lottery winnings? You have to have a well thought out reason because you are going to have to show the court that you have a good reason for selling your annuity payments.
Reasons for Selling an Annuity:
- You want to avoid bankruptcy. Many people in the United States have to file for bankruptcy. For example, more than 3,400 people a day made this decision in February of 2015. In the United States. Nearly one in five Americans list themselves as being in “debt hardship.” Selling an annuity to avoid filing for bankruptcy is a very good reason to do it.
- You want to pay for someone’s education. Getting a college degree is a great way to increase your income potential or that of a family member. The problem is that college is expensive. If you have a structured settlement with payments coming in every year or month, you and your children may not qualify for financial aid. The average cost for a public college is over $9,000. If you are looking at private schools, that costs over $31,000. That is per year.
- You want to open your own business. Most start-ups fail because they do not have access to enough working capital. Selling a structured settlement can give you the money you need to get your company up and running. With the money from your structured settlement, you will have a better chance of making it succeed.
- Pay off your mortgage or buy your dream home. Imagine buying your dream home outright or not owing anyone for your home. That is a great feeling. The average amount most people owe on their homes is more than $70,000 but some people owe a lot more than that. If your home has lost value since the great recession, you may more than the house is currently worth.
These are just some of the reasons judge’s will green light a sale of a structured settlement.
Find a buyer. First ask your friends and family if they have ever done this. You would be surprised at how many people have sold structured settlements. Get quotes from a few different companies and get everything in writing. When you call companies and ask about how to get money from a settlement now, make sure they are willing to go over all of the details of your sale. Ask for references. If the company is not willing to take the time to answer all of your questions and go through the details, go to someone else.
Go to court and get a judge to approve your sale. They will want to know that you understand the tax ramifications of selling an annuity and your reason is solid.
Once the sale has been approved, it should take about 30 to 45 days to get your money. Now all you have to do is whatever you want!