Cash For Structured Settlement-What will Cashing-Out Cost me?

You may be a little disappointed to find that what is offered to you, is not what you expect. If you were to add up all of your remaining settlement payments, you will find that the amount offered is much less. The structured settlement was based on a certain amount of money that was put into an annuity and then that principal amount, plus interest paid out, equaled the settlement amount. This may make you consider other options other than getting cash for your structured settlement.

A simple example of this is as follows: If you have a $1,000 invested at 7.2%, in ten years it will be doubled, meaning that your payments actually add up to $2,000 even though the initial investment was $1,000 or less. The present value - the $1,000 will be discounted to cover costs to do the deal and the remaining is then given to you. There are costs involved that include attorney and filing fees. You need to determine if it is worth the loss prior to making the deal. The good thing is, you can choose too cash-out only a portion of the annuity, rather than the whole thing. There are programs that allow you to do this so that you can still enjoy receiving a monthly annuity and get some type of future payment.