How Should I Spend My Lump Sum Payment?
There is a survey that has suggested the majority of lump sums are spent within five years. Now, let's think about that for a minute. Your average structured settlement (or lottery winning) is set to support the average person for the next several decades, or even their lifetime. However, if you sell that, you could be looking at financial freedom for the next five years, and then you would be back in the same position you are right now... in need of cash.
We don't want this to happen to you, so we have prepared a few suggestions of how to manage your lump sum once you receive it:
First and foremost, get an accountant. While you may have always handled your own finances, a large lump sum can be a lot to handle, not to mention a big temptation. An accountant will be able to give you advice on how to avoid unnecessary fines as well as tax benefits, and establish a long-term plan to pay off debt, and invest the remaining cash towards a savings or retirement plan.
Which reminds us, you should always use the money for its intended purpose first. If you have money leftover, you can consider an investment or purchase. However, in order to avoid any unnecessary debt, it is important that you use the lump sum for what it was intended. Even if you take care of your most pressing debt; if you have other debt, it might be wise to use any leftover cash to help pay those down.
Investments and gambling are not recommended ways to spend your lump sum. If you are interested in making money from investments, and you do not have experience, we suggest seeking the advice from a professional who can help you make the right decisions. Consider yourself lucky to have had the means to receiving a large sum of cash, and your chances of ever coming across such easy money again are low.
We also do not recommend quitting your job. It has been said that it is next to impossible to retire on just one million dollars in the real world, so if you are tempted to retire early, speak with an accountant first. There may be a job you would like better, that will enable your lump sum to last through the remainder of your life, without putting you or your assets at risk.
However, we are getting a little ahead of ourselves. Please contact us today, so we can help you get the most cash possible when selling a structured settlement, annuity, or lottery winnings, and then you can worry about how you're going to spend it.
To understand more about structured settlements, please make use of the resources this sites offers.