Personal injury suits are fairly common. Over time, courts of law that have heard such cases across the United States have molded the system in a way so that people who have genuinely, seriously been injured are likely to receive compensation for what they’ve suffered.
One thing that courts, attorneys, and other legal professionals have seen far too often is claimants being awarded settlements, only for them to blow through that money far too quickly.
Only you can keep your personal finances in good shape after being awarded a structured settlement – not the courts, your attorney, family members, or anybody else. As such, you should educate yourself well on how to manage structured settlements as a personal injury tort claimant.
Seek a detailed, thought-out, long-term plan from an advisor
Let’s face it – you probably aren’t a financial expert. As such, especially considering that you could be out of work for months on end due to the injury you’ve sustained, if not considered legally disabled for the rest of your time here on Earth – you’ve got to get the management of your settlement right your first time around.
Don’t look for fee-based advisors, who are those that make commissions for selling certain products. Rather, opt for fee-only advisors. You’ll get a lot better advice and a much more detailed plan to fit your needs from a fee-only advisor.
Consider investing in yourself
If you can’t perform physical tasks as well after the injury as well as before, it might behoove you to invest in the creation of a skillset, credentials, or other intangible assets that allow you to work from home or in another capacity where physical ability is of no concern.
Paying for formal education could be a suitable path for you – but don’t just go to college because you don’t know what else to do! Now that would be a waste of your settlement.
Satisfy debts quickly, start investing faster
In almost all cases, interest accumulated on debt outweighs growth on investments. As such, you need to pay off all your debts first.
Don’t treat your settlement like it’s part of your regular income, either. Maintain a job and use those earnings to live on. Use the settlement money to pay off debt as soon as possible – throw your regular earnings’ disposable income at it, too, if you can afford to.
The sooner you satisfy all your debts, the sooner you can start earning income on investments. Don’t lose track of how valuable these initial steps after your settlement receipt are. The more life you have to live, the more interest will compound on your investments.