# Understanding Using a Structured Settlement Calculator

If you’re looking for a way to compute a realistic value of your future structured settlements, a Structured Settlement Calculator can be a very useful tool. A Structured Settlement Calculator can show you what your settlement might be worth if you were to sell all of your future payments for one lump sum today. The first piece of information you’ll need to input is the amount of each structured settlement payment you are currently receiving. The second piece of information that you’ll need to input is the date on which each structured settlement payment is due. Once you’ve entered in these two pieces of information, you’ll be provided with a table comparing your settlement to others of like type and value.

In general, the only necessary first information to properly conduct a comparison through a structured settlement calculator is: Amount of each structured settlement payment, date of each structured settlement payment, and frequency with which the structured settlement payment is paid. Other than those items listed above, other information you may need to provide is the number of years your payments are scheduled to be made, your age at the time of settlement, your regular monthly and annual income, and your total assets. This information is used to make the specific mathematical calculations that are used to determine your potential income from selling your future payments.

Once you have entered in your information, you’ll find that a Structured Settlement Calculator will return your results. The most common results will be a table comparing your lump sum amount to others of similar value that are listed in the past. If there are no other structured settlement payments listed that are equal to or greater than your lump sum amount, then you’re eligible to receive the lump sum amount. If there are other payments listed that are less than your lump sum amount, then they must be forfeited in order to receive the payout. The calculator will also tell you if you’re able to choose between several different payments that would be made over a certain period of time. This is determined by the amount of time left before your structured settlement expires.

The next piece of information that you’ll need to provide when using a Structured Settlement Calculator is your interest rate. The interest rate is what represents the amount of money you would receive if you were to sell all or part of your future payments. In most cases, the best interest rate is based on information provided by the U.S. Treasury Department. When using the calculator, you’ll need to enter in your present value, which is the current price of all applicable future payments, less any amount for early termination fees or other charges.

Once you’ve entered in your information, you’ll need to determine an effective discount rate. The effective discount rate is the percentage of your lump sum that you want to receive when selling your structured settlements. Life contingent payments and annuity payments are exempt from this discount rate; however. Once you’ve determined the effective discount rate, you can then select the payment dates that will work best for your particular situation. Some calculators allow you to select payment dates that lie in the future or those that are paid after a specific amount of time has gone by.

If you are unfamiliar with the terms and structures used in the different pieces of information that you need to input when using a Structured Settlement Calculator, you may find it useful to look up additional information on the internet. A Structured Settlement Calculator can be found free of charge or you can purchase a more comprehensive version of the software. The most complete online Structured Settlement Calculator will allow you to input not only your information but other pertinent information as well, including the amount of future payments you want to receive and the effective discount rate. These calculators are a great way to see if you have a realistic chance of selling your remaining lump sum.