This is a special post that is tied to a huge $1000 Cash Giveaway. You can enter using the widget at the end of the post. You get two entries by liking Debt Roundup on Facebook and Subscribing to my RSS feed. Enjoy!
One thing that I have contemplated before was if I were to come into a nice windfall, how would I want to have it? If I won the Powerball or Mega-Millions lottery, would I take the lump sum cash payment or the annuity payment over 30 years? I am not sure about you, but I would probably take the lump sum payment. There are many reasons why I would do this, but the biggest reason is the investment opportunity and the control over the money.
No matter if you win the lottery or have a structured settlement for a variety of reasons, annuity payments can be nice, but you have to deal with the payments for over the annuity term. If you get the lump sum payment, then you get the cash upfront, minus all applicable taxes and any discounts. You then have the control over what you want to do with the money. I for one would use the lump sum payment for a variety of investments.
If I take a portion of the payment and invest it in the stock market, then I could increase my money by about 9% based on historical trends. This is a great return for almost no work. I like the ideal of having more control over my money and growing it on my terms. Yes, I could grow my annuity payment, but that could be more volatile based on the number of years the payments are made. Not only can I invest in the stock market, but I could secure great dividend paying stocks along with P2P lending through Prosper or Lending Club. I could also use the money to invest in businesses that I think will succeed. The investment possibilities are endless.
If you are someone that is dealing with a structured settlement, have you ever thought of selling your annuity? Whatever your reason, whether it be to pay bills or more financial control, there are ways to sell your annuity in order to cash out. You can even get cash advances based on your annuity payments. Just because you have a structured settlement doesn’t mean that you have to stay on the current path. If you are in need of the money and want a lump sum payment, then selling your annuity can be an effective way to get your cash windfall.
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