Selling Annuity Payments For Cash: Is It A Good Idea?
Do you receive regular annuity payments? Are those payments a little bit smaller than you would like them to be? If you aren’t satisfied with the money that you are currently receiving, you may be able to sell your annuity payments for cash.
Obviously, selling your payments for cash isn’t always going to be a good idea. You will want to weigh all of your options before you go through with something like this.
That stated, selling payments can be beneficial. Here are a few of the things you should know about selling your payments for cash:
You’re Going To Lose Money
If you decide to sell your payments, you aren’t going to receive as much money as you would otherwise. Receiving a lump sum of cash can be very helpful, but you will have to pay a price for that convenience.
Because of this, financial experts usually recommend that you don’t sell your payments unless you need to. If you have major expenses that have to be covered, selling your payments might be a good idea. If you don’t have anything that you need to pay for, then you might want to continue to receive your regular payments.
The decision you make is going to have an impact on your financial future. No matter what choice you wind up making, you will want to make sure you are comfortable with it.
You Might Have To Pay Later On
While you will lose a portion of your annuity, there is another expense that you are going to have to worry about. Depending on your age and the amount you will be receiving, you may also have to pay back taxes at the end of the year.
You are going to want to make sure you are prepared for this extra expense. If you spend all of the money you receive from selling your annuity, you may not have enough cash to cover your tax bill.
While settling your annuity may be able to help you get back on track financially, it could also cause issues for you. You are going to want to be aware of what you are getting into.
Choose The Right Broker
More than anything else, you are going to want to make sure that the broker you sell your payments through is someone that you can trust. You shouldn’t have to question the advice that they give you; you should be able to trust them completely.
If you know someone that has sold their annuity, you may want to talk to them about the choices that they made. Try to see if they can recommend a structured settlement broker to you.
Selling your annuity payments for cash isn’t always going to be a good idea. With that said, in some cases, it can be extremely beneficial.
If you are planning on selling your settlement, you should set up an appointment to meet with a broker. They will be able to give you some very valuable information.