December 2, 2016
A personal injury can be a life-altering event where a person is not able to function as they used to and this can lead to trauma, stress, and an inability to remain financially stable. There are thousands of people who are put into positions such as these on a regular basis, and it becomes pertinent to find a way out.
This is where structured settlements come into action as a viable solution for claimants. The premise behind a settlement of this nature is to resolve personal injury claims in a structured manner. A set of payments are allocated in the claimant’s name based on what both parties have agreed ensuring a lump sum isn’t required, but funds are still provided to those in need. This compensation is necessary and will take into account one’s income (before the injury) and what the lawsuit claims.
This will create a consistent stream of money for the claimant to live off of while they’re recovering even if the condition is a long-term one. This ensures both parties come to a complete settlement that works well and provides sufficient value to the claimant as desired.
For some, the settlement is an incredible reality and can ease some of the concerns of a personal injury and its impact on the body. However, it is possible to sell structured settlement payments to acquire a lump sum instead of having to wait. There is a process in place to ensure this is done legally and in a manner where one can get a fair amount of money for their settlement.
Let’s begin with the process of selling the settlement once it has been established. There are five steps in the process before a person can get the deal sealed and passed through.
It’s a simple process ensuring a person can get things done legally where all parties are aware of what’s taking place and the amount being received. The motivation to do this is to ensure a lump sum is being acquired in the long-run rather than having to wait for the scheduled payments to come through one by one. Most people are not willing to wait for long periods to get the funds they require.
Now, beyond the lump sum, why would a claimant want to get the money through this method? It begins with being able to take the money and invest it for long-term growth. Most individuals who are dealing with a personal injury have continued concerns, which will make it hard to earn money for a long time to come. This is an excellent opportunity to eliminate some of the waiting periods and start investing in what one deems best for their fiscal future.
Another benefit comes from being able to plan based on the entire amount rather than having to wait for money to come in. Most people will have debt on their shoulders and might want to make those payments immediately rather than letting the interest rate get out of control. If that’s the case, it becomes better to go down the path of making the sale. It will take away most of the risk and enable a person to move forward with their life having all the pieces in their hand.
This is where selling the settlements makes a lot of sense.
The next step for the claimant is to find a good company that will go through with this process and remain reliable at the same time. Some companies purchase these settlements, and they’re popular options for those who want to play things safe and get the deal in place immediately. It’s important to know what is required to find a good deal and move on with life.
What should a person be thinking about when choosing a structured settlement company? There are multiple factors to ponder over when it comes to finding a good agreement that will work for both parties and give you favorable results in the long-term. The first thing to look for is reliability because you will want things to move along at a good pace where you get cash as soon as possible. You want the court and judge to be passing the agreement through, and when a trustworthy company is on your side, these things move along rapidly giving you the funds when you want them rather than having to wait. Go through these details and choose a good company that will have value to add and will give you a good deal.
There are three good companies on the market right now for a claimant to consider. These companies are called JG Wentworth, Peachtree, and SenecaOne. Here is a little review on each to determine what they bring to the table for those who are intrigued.
November 23, 2016
When you get hurt at someone else’s hands, it can be difficult for you to truly believe that there is a light at the end of the tunnel. One of the best things you can do is opt for a structured settlement, as opposed to a lawsuit. You will not be alone if this is what you are seeking since more than 90 percent of personal injury cases end when you receive a settlement, as opposed to waiting for the judge to hear your case. However, before you opt to receive one of these settlements for your personal injury case, you should read some of these valuable tips.
A structured settlement is an agreement by which you can receive compensation in the form of a lump sum or stream of income. You will get this money through the facilitation of a third party company, as opposed to going to court and waiting for the judge to award you a settlement amount. In accepting this payout, you are doing so by choosing to drop the lawsuit and instead go for the settlement. However, it is important that you match up with a company that can assist you.
It is important that you understand what the process entails when you are looking to get payment for your injuries and damages. First and foremost, let’s take a look at the options in front of you:
There are a lot of different reasons that people choose to sell their structured settlements. This is an incredible way to get more money in your pocket in a way that is useful to you, as opposed to keeping the settlement potentially not getting a large amount of money all at once. Because of this, you will need to assess your situation to figure out which will be the best option for you. You will also have the opportunity to hire a company who can help you out with the process of receiving and selling your structured settlement. This will ensure that you give just compensation for your injuries, while also exercising your very favorable option to sell your settlement should you see fit.
To be sure that you get the most out of your structured settlement, began looking into the work that the premier companies in the industry can provide for you. The premier companies that provide structure settlements include Peachtree financial, JG Wentworth and Seneca One. These companies have been in business for between 14 and 25 years and have been at the forefront of the industry when it comes to providing structured settlements. The first step when working with these companies is to contact a representative that can assist you. These representatives will go over the terms of your case and will see to it that you get a sound estimate on how much money they can get for you in a settlement. Such an out-of-court cash agreement will be so useful because you will not have to appear before the judge, but will still get the money that you need in order to pay for your injuries, medical bills, property damage, pain and suffering, loss of consistent income and any other issues that you are dealing with. You will also be able to work with these companies so that you can get set up with a buyer for your structured settlement agreement.
When looking to hire one of these companies, make sure that you actively go over the paperwork to get the best possible situation and to understand what you will be responsible for and what you can expect out of the settlement agreement. This way, you will not have to go into this process blindly and will be better able to make the most out of every single step of the process. Make sure also to take inventory of the amount of money that you hope to receive out of this process and how you would like this money allocated to either in the form of keeping your structured agreement or by selling it.
Taking these guidelines into account, you’ll have some great information that will set the tone for the rest of the process. It pays to have a strong foundation when it comes to going forward with a structured settlement agreement, and this article will put you on the right track. Now you can reach out to one of these three companies mentioned above to take the next step in this regard.…Read more
November 15, 2016
“If you think nobody cares if you’re alive, try missing a couple of car payments.” Earl Wilson
First, if you live and work (or go to school) in an urban area with public transit, most people can get by without a car. Taking public transit is often inconvenient, sure. But it’ll save you a ton of cash compared to making car payments.
Now I’m not saying that everyone with access to public transit shouldn’t own a car.
The point I’m getting at is that if the only way you can afford to buy a car right now is by getting a car loan, and you have access to public transit for getting to work or school, there’s a good chance that you should not be buying that car.
I hope you’re not getting annoyed at me for saying that. Stick with me a minute or so longer.
Brent lives in Chicago and is debating whether or not to buy a car via a loan. If he buys a monthly public transit pass, it’ll cost him 100 bucks a month. But he feels that given his decent job and the fact that everyone else in his social circle has a car, he should have one too. He feels social pressure to conform. And besides, taking public transit to get to his job every day means a longer commute.
If he buys a brand new 2016 Honda Civic LX, it’ll cost him $19,670 by the time taxes and fees are added on.
His bank told him they’ll give him a car loan at 4% interest, to be paid off over 60 months (five years). His monthly payments will be $362. When the car is paid off, he’ll have paid the bank a total of $21,720, or $2050 more compared to paying cash.
Brent isn’t rich, so to him, having an extra $2050 would be a lot of money.
But wait, there’s more. Brent works downtown, so if he drives a car to work every day, he’ll have to pay $180 per month to park his vehicle there. He also has to insure his car. That will cost him close to $100 a month. And last, but not least, he’ll be responsible for maintenance and repairs. He’s budgeting low for this since it’s a brand new car under warranty – he figures $400/year is a good number (works out to $33 per month. He also budgets $200 per month for gas.
So the grand total cost of car ownership if he gets a loan to buy it comes out to $875/month (=$362 + $180 + $100 + $33 + $200).
Over the next five years, assuming all his estimates were accurate, he’ll spend $52,500 for the convenience of buying that car, using financing.
Now it’s time to consider how this new car purchase will look if he does it another way.
He can use public transit for a total of $100/month.
For this example, let’s say Brent could afford to pay $875 per month to own a car if he wanted to.
But let’s say he decides to suck it up and use public transit while he saves up the difference in cost to buy the car in cash. How long will it take?
Well, by taking public transit, he can set aside $775 per month (i.e. $875 cost of car ownership – $100 cost of using public transit). In only 26 months, he’ll have saved up $20150. Even if the cost of a new vehicle goes up by then, he’ll still only have to save for one or two more months, at most.
So let’s see how the numbers look now:
26 months of public transit at $100 per month adds up to $2600.
Buying the car with cash cost him $20,150. (For the purposes of this example, let’s assume that two years from now, a brand new Honda Civic LX would cost that amount, including all taxes and fees.)
Then we’ll tack on another 34 months of car ownership expenses, which would be about $17,442 (i.e. $180/mo parking fee + $100/mo insurance + $33/mo average repairs + $200/mo gas).
The grand total he’ll spend on transportation costs over the next 60 months (5 years) if he uses public transit for the first 26 months while he saves up to buy that car in cash is $40,192.
By choosing to save up and buy that car in cash, he’s putting an extra 12 thousand dollars in his pocket. (i.e. $52,500 – $40,192)
Just like that.
So what was the point of all that?
To show you how much money a person can save by using public transit while they save up cash to buy a car, and to show how quickly one can save up the cash to buy a car outright (even a brand new one!) if one makes strategic spending decisions.
Are you rich enough to burn 12 thousand bucks so that you can have a brand new car today?
And maybe you don’t want to buy a brand new car. Which is a good thing, actually. Because you can save more cash by buying a good quality used vehicle.
Let’s say our friend Brent from Chicago decides to buy a used Honda Civic that’s in excellent shape. He has to save up some cash first, and after 10 months of taking public transit he has $7750 saved up (i.e. $775 x 10 months). He finds a really nice used Honda Civic LX for sale with an asking price of $7750.
Because it’s not a brand new vehicle, he budgets more for repairs – about $1200/year, which works out to $100 per month if you average it out. He adds in $180/mo for parking downtown, $100/mo for insurance, and $200/mo for gas. The grand total works out to $580/mo.
So what does this add up to over five years?
Ten months of public transit costs him $1000.
The car cost him $7750 to buy.
And 50 months of driving the car cost him $29,000.
That all adds up to $37,750.
So in this scenario where he saves up for a quality used car, he’s putting an extra $14,750 in his pocket compared to buying a brand new Honda Civic LX today via a car loan for 100% of the cost. (i.e. $52,500 – $37,750).
Now obviously many of these numbers are best guesses. But the best guess is better than no guess at all and blindly signing up for a five-year car loan.
This is the kind of number crunching you need to do before you assume that you have to borrow money to purchase a vehicle. Look at the alternatives. Calculate the costs. See if the savings are worthwhile (usually, they are!)
Oh man, don’t get me started on leasing a car. Leasing a vehicle is often thought of as a more sophisticated way of owning one. And some people spout over-simplified nonsense such as “always rent or lease things that go down in value”. If you’ve ever heard that kind of crazy talk, this section of the book is for you. You’ll never again be left feeling unsure about leasing, wondering if you’re missing out by not doing it.
Let’s go back to Brent and that Honda Civic LX he wants.
The dealership tells him he can drive away a brand new Honda Civic LX for only $165/mo including tax. The lease term is 36 months (three years).
By the way, there’s also a one-time fee for title and licensing of $170, and a one-time document fee of $600.
Err, how about no.
In three years he’ll lease another new car, and for the sake of simplicity and our rough estimate, let’s pretend the fees and price remain the same. That means another one-time fee for title and licensing of $170, and a one-time document fee of $600.
The total cost of leasing for the next five years will be $11,440.
Don’t forget to tack on $180 per month for parking downtown for work, $100 a month for insurance, $33/mo for maintenance and repairs, plus $200/mo for gas. All that adds up to $513/mo, or $30780 over five years.
The grand total for leasing that vehicle is $42,220 (i.e. $11,440 + $30780)
Okay, so maybe now you think that doesn’t look too bad.
DON’T BE FOOLED. Car dealerships want you to think that. It’s all part of their master plan.
Now keep reading.
We already know that Scenario A, getting a loan to finance the purchase of a new car, is an expensive way to go, so I’m not even going to bother comparing leasing to that.
Instead, let’s compare leasing to the better options of Scenario B and C.
In Scenario B, Brent saves up the cash to buy a brand new car after using public transit for a couple of years.
The cost of his transportation for five years ends up being $40,192. So already, it’s cheaper than leasing, although not by a huge amount of money.
But since Civics are well-made and tend to be reliable, he figures he’ll keep this car for ten years, no problem.
For Scenario B, let’s add up the cost of his transportation for 10 years (which includes 26 months of public transit while he saves up the cash to buy the car, 60 months of low $33/mo repair costs because the car is under warranty, and 34 months of higher $100/mo repair costs after that).
For years 6-10 he’ll spend $10,800 ($180/mo) on parking downtown, $6000 ($100/mo) for insurance, and $12,000 ($200/mo) for gas. Car maintenance will cost him $4258 (i.e. 26 months at the new car warranty rate of $33/mo plus 34 months at the older car no warranty rate of $100/mo). All of that adds up to $33,058.
So if he saves up the cash to buy a brand new Honda Civic, and keeps it for ten years, he’ll pay a total of $73,250 for owning and operating that vehicle.
And, now this is important, he still owns the vehicle and could sell it for cash if he wanted. Say he sold it for $6500. Now his costs of transportation over the past 10 years drops to only $66,750 (i.e. $73,250 – $6500 profit from selling the car).
Whereas if he leases a new vehicle every three years, he’ll pay the fees that come with the start of a new lease three times in a 10 year period, for a total of $2310. And he’ll pay 10 years worth of monthly lease payments, totaling $19,800. And he’ll pay 10 years worth of parking fees, gas, insurance, plus maintenance and repairs (at the new car rate), for a total of $61,560.
That brings the cost of leasing a vehicle for ten years to about $83,670.
Leasing a Honda Civic for ten years would cost Brent about $17,000 more than he’d spend on transportation if he bought it brand new for cash.
And as you’ll remember, Brent would save even more money under Scenario C where he buys a high quality used Honda Civic for cash.
Repeat after me. “Leasing a car instead of buying a high-quality vehicle for cash will almost always cost more money in the long run.”
Never, ever, lease a vehicle unless you’ve taken the time to calculate the true costs, compared it to reasonable alternatives, and proven to yourself that it’ll save you money.
I came across an interesting discussion the other day where someone was arguing that any loan that has collateral is actually good debt, because you can pay it off anytime you want by selling the collateral used to obtain the loan in the first place.
This is such complete and utter nonsense that you should be recoiling from the very idea of it. Here’s why.
First, the value of the collateral could go down and leave you with a loan for more money than you can get from selling said collateral.
And second, if the loan isn’t making you more money than what you’re paying in interest, it’s basically causing you to flush your hard-earned money down a virtual toilet due to all the interest you’re paying to the bank (which you’d never have to pay if you’d bought the thing with cash in the first place).
You work hard for your money. Don’t flush it down a virtual toilet for no good reason.
Now you know enough not to be fooled by the lies you’ve been told about debt. It’s now time to sort out the good debt from the bad so you can prioritize what to pay off first. The next chapter will tell you how to do that.…Read more