You always buy a lottery ticket on your way home from work, just in case. You have imagined all of the things you would do that would change your life, if you were to win. The lottery drawing comes on and you sit on the edge of the couch, waiting for the numbers. You continue to stare at the screen, realizing that you have just won. You double and triple check your numbers, ensuring that it really is a winner. You have confirmed your winning and you scream out in joy, calling your family members to you. Everyone is very exciting, talking about the things you will do with that money. Months later, however, you find that you will only receive small monthly payments. These monthly payments will definitely make paying your bills easier, but isn?t the point of winning the lottery to change your life drastically?
You already lose a big chunk of the money off the top for taxes. Off the top, the lottery withholds 25% for federal tax, then, depending on where you live and your tax bracket, another 6 to 9% for state taxes. Your winnings will seem even smaller, when you are only receiving them in smaller, monthly payments. Fortunately, you have the option of getting a lump sump amount of money in return for your structured settlement.
There are companies that do business on buying an annuity with a lump sum. They essentially purchase your monthly payments, meaning that every monthly payment you receive from there on out, will be forfeited over to them. However, they are purchasing these monthly payments with a large lump sum payment, an amount that is similar to your original lottery winnings, minus the taxes and the fees for the sale.
When these businesses are buying an annuity with a lump sum, they are providing you with the opportunity to do all of those things you originally wanted to do with your lottery winnings. You can purchase that large home in cash. You can purchase that dream car you have always wanted. You can even pay down your debt, increasing your chances at having a secure financial future. Buying an annuity with a lump sum allows you to invest your money in different stocks. You can also have your retirement account all ready. Depending on your age and on your lottery winning amount, you can potentially retire early, taking all of those vacation trips that you always dreamed of. Buying an annuity with a lump sum provides the lottery winner with many benefits.
Nearly 1 in 5 Americans ages 18 to 24 qualify themselves as being in debt hardship. This can make it very difficult to begin an adult life. If you are in this age range and you are in debt hardship, you probably are unable to purchase your own home or vehicle. You may not be able to afford college, or you owe large amounts of student loans. If you have a medical condition, you will find that medical costs quickly put you into debt. Many American families are just one emergency away from being in debt. When you sell your lottery annuity and allow the company to buy structured settlements from you, you are setting yourself up for a secure financial future. 26% of Americans admit to not paying their bills on time. If you invest and plan for your future correctly, you will not have this problem.
Winning the lottery can be very exciting. You probably plan what to do with your winnings before you even receive them. Until you find out that you will, instead, only receive smaller, monthly payments for your lottery winnings. The difference between lump sum and annuity can be the difference between a secure financial future and financial hardship. When you have access to all of your money, you are opening up to endless possibilities that will only improve your financial future and set you up for a life of no debt and numerous financial possibilities.
