Anyone can have financial problems every now and again. Unfortunately, some people face financial problems more often than other people do. They end up getting debt settlement advice to overcome their financial problems. One large financial problem many people face is their settlements. Today, we analyze what structured settlements are and the advantages of non-qualified structured settlements.
What are Structured Settlements?
As the name implies, structured settlements are agreements between two parties. Structured settlements are usually insurance or financial agreements that have been put forward and approved by the Internal Revenue Code.
These settlements are usually made against settlement claims when a person suffers personal injury. If you have ever heard of a court case that was settled out of court, it is more than likely that a structured settlement was involved.
Structured settlements were first used in Canada, where families were being compensated due to the side effects of Thalidomide. The drug was causing birth defects in children when pregnant women were administered or prescribed Thalidomide.
The main purpose of structured settlement is to guarantee appropriate compensation to the concerned party. Not only does it state that the money will be delivered to the outlined receiver, it states that they will receive payment on time and without a hitch, problem or involvement of any third party.
Uses in Divorce Cases
Everyone dreams about getting married and can’t wait for the day their dream comes true. Unfortunately, there are times when a marriage can be a complete disaster. One of the biggest uses of non-qualified structured settlements is in divorce settlements. There are in fact many advantages of getting a non-qualified structured settlement drafted for a divorce case.
The main advantage is that you have a guarantee that states that your child will receive proper child support and on time as well. Receiving payments on time can be one of the biggest problems for many single parents. Non-qualified structured settlements are the only way they will really have any peace of mind.
This reduces the chances that a new court hearing needs to be held in order to ‘fix’ the situation. Remember, court cases are not free either. Therefore, it can be said that non-qualified structured settlements save you money as well. This is great for the beneficiary of a non-qualified structured settlement as s/he will have a steady flow of income and can budget more efficiently.
Uses in Debt Cases
In many cases, private firms can even agree to buy the non-qualified structured settlement from you, giving you a single, upfront lump sum payment. For example, if you are to receive $200 a month for 2 years, the private firm can give you $4800 upfront and purchase your non-qualified structured settlement. This can be great if you need cash urgently.
Most people try to stick to their non-qualified structured settlement as they gain a steady flow of income. However, many people decide to sell their non-qualified structured settlement when they are in debt. This is actually great debt settlement advice! This is usually a last resort for most people who are in debt and have a -qualified structured settlement.
If you are in debt, non-qualified structured settlements can help keep you out of it. While you continue to work, the money from your non-qualified structured settlement can be used to pay off your debt. You could even use your own money to get out of debt faster.
The best part of non-qualified structured settlements is that they can be a source of lifetime income. If your non-qualified structured settlement lasts for 30 years, you have a guaranteed source of income for the next 30 years; despite the giving party’s circumstances. If you need to put your kid through college, you can even sell you non-qualified structured settlement and accomplish the task.
One of the biggest advantages for the paying party is that they usually receive discounts in terms of payments rather than giving the ex-spouse money whenever they need it. The non-qualified structured settlement will ensure that the ex-spouse is never given more than he or she needs.
Non-qualified structured settlements are a huge advantage not only to the receiving party but also to the paying party as well, regardless of the case.
About The Author:
Shannen Doherty is a financial writer associated with many finance related groups and communities. She writes on various financial topics such as personal finances, debt, debt settlement advice, debt relief etc.