How Long Does a Structured Settlement Last?

Structured settlements are designed to provide periodic payments over a fixed number of years, allowing the plaintiff to decide how the money is distributed and how much is provided annually. This type of agreement offers several advantages, such as guaranteed long-term income and the ability to recover without spending time and resources determining investment strategies. It's important to weigh the pros and cons of agreeing to a structured agreement in relation to your unique circumstances, and you should always consult your lawyer and a structured settlement consultant. Inflation-adjusted structure plans are available from some insurance companies to account for increases in the cost of living.

If you need immediate cash, you can “collect your future structured settlement payments by selling them to a factoring company at a discount. Structured settlements or structured annuities are both financial products and legal judgments. The money you receive in a personal injury settlement is generally not taxable, but you do have to pay taxes on the interest and dividends you receive on the settlement money after you invest it. Legislation enacted in 2002 protects those who sell their structured settlement payments due to financial difficulties in paying taxes on that amount.

Some agreements are designed to provide an annual income, with additional amounts allowed to pay for extraordinary expenses, such as college tuition. If your expenses increase while you wait for your first structured settlement payment or initial lump sum, pre-settlement financing options may be available to help you. Overall, structured settlements offer many benefits for those who have won or resolved a lawsuit. It's important to understand all of the details before agreeing to a structured settlement agreement, and consulting with an expert can help ensure that you make the best decision for your unique situation.