A Structured Settlement Calculator is a financial tool used by those who receive structured settlements. These tools are typically easy to use and can save you a lot of time when trying to determine the amount of money you will receive after a settlement. The first piece of information needed to calculate a suitable deal is the amount of each structured settlement payment received. Because the actual value of structured settlements vary greatly from one case to another, it is often impossible to provide a universal answer for how much you could receive. However, there are ways to approximate the best case scenario for receiving a payout.
In general, the only required information to properly conduct a query through a structured settlement calculator is: Actual amount of each Structured Settlement payment received. A date is also needed, preferably the date on which the transaction was entered into the structured-settlement exchange. How frequently the structured settlement payments are exchanged (Quarterly, monthly, annual) and the number of years the periodic payments have been outstanding are also factors that must be entered. Some calculators may allow other variables such as minimum guaranteed interest rates, lifetime interest rate guarantees and life expectancy assumptions. If you want to include these additional variables, you should enter them as well.
One of the most common uses of a structured settlement calculator is to determine how much money will be needed to cover living expenses, and set up a budget for the future. Once this information is entered, it can be compared with your current situation to see if a lump sum amount will be sufficient to cover everything you would need. Again, you should only use this type of tool in situations that are similar to your own. If you are not sure what your situation would be like in the future, you should not use this type of calculator. Structured settlement calculators are intended to provide an estimate, not to provide a prediction.
Another use for a structured settlement calculator is to establish an allowance for future benefit payments. This is necessary because most insurance companies do not allow cash payments to continue over time. This can be done by simply plugging in your expected lump sum amount and the current value of your savings. You can also plug in your expected interest rates and annuity payments and determine if you would still have enough money to ensure you would be able to make your payments. Once you know the answer to this question, you can safely stop considering selling your annuities.
When using a structured settlement calculator, you can also get an idea of your net worth. Your lump sum settlement can be compared to the current worth of your home, mortgage and any assets you have. The total value of your home and net worth will help you determine the potential tax implications and benefit from selling. It is important to remember that your potential tax obligation will only be determined upon selling your structured settlement payments. Therefore, you should take into account the current value of your home, not your mortgage, as the basis for your determination of your net worth.
In conclusion, a structured settlement calculator can be a very useful financial tool. Not only does it help you determine the amount of money you could realistically receive in exchange for your annuity or settlement but it can also help determine how much you should give up before you even think about selling. The calculator is easy to use and can be found online for a relatively low fee. Regardless, of whether you are planning on selling your payments or you simply want to know your net worth, a structured settlement calculator can help you.