Before you consider accepting cash for annuity payments, you should access an online calculator that will help you determine what you will gain and what you might lose. Of course, when someone considers turning his or her structured settlement investment into a lump sum cash payment, it is generally out of immediate financial necessity. If that is true for you, it is still important that you try not to let your immediate financial crisis dictate your acceptance of a poor payout. Get all the facts and figures and then decide.
It may be as well that, like many folks who purchase an annuity at the advice of financial advisors they trust, you do not understand all the ins and outs of your annuity, and what you will give up or gain by accepting cash for annuity payments.
Here are the basics
* An annuity is a financial product that allows you to pay into it on a regular basis so that at a designated time in the future – generally at retirement – your contributions plus the interest they have accrued will provide you a designated and constant periodic payment for the rest of your life.
* Cashing out that annuity means that you sell someone else the money you have paid in so far for a lesser but immediate lump sum dollar figure, wiping out your ability to draw on the annuity in the future.
As with walking into a pawn shop and turning over your 500 TV for a pawn ticket and 100, on the face of it you have not gotten the better end of the deal.
However, if you are like so many in this troubling economy your need for funds might well be immediate and crucial you might feel that cash for annuity payments is a good option to put food on the table and pay your other bills. It may even be your only option.
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