Credit card debt is a huge issue in our society and something that sinks many individuals and households. It can be a tough thing to get out from under once you’re in — in 2014, American households had an almost $60 billion increase in new debt accrued on credit cards. Additionally, the average balance on a credit card is over $7,000! So what happens if you suddenly come into money? Clearly, the American population has a difficult time managing their money responsibly. So if you come into money because of a lawsuit, you’ll want to handle it more responsibly. You should consider a pre-settlement cash advance and if you’ve won it big on the lottery, consider a lump sum payment.
How Would A Pre-Settlement Cash Advance Help Me?
If you receive money through a lawsuit that has to deal with personal injury or insurance, it’s often likely that the insurance company will give you what is known as structured settlement. This developed in the mid 1950s and grew in the 1960s. Instead of getting one lump sum, you’ll get scheduled payments that are smaller in sum over a span of years. If you get cash for a settlement, you’ll get it all at once in cash instead of through a check. A pre-settlement cash advance will let you have money to handle any impending legal or medical bills before the settlement even shakes out. It’s a quick cash option for immediate expenses.
How Would A Lump Sum Payment Benefit Me?
If you happen to win the lottery and you opt for the lump sum payment, it means that you will get your winnings (after taxes) in one amount, instead of having it paid out to you by the lottery over the course of a few years. Having the whole lump sum payment in your hands gives you more freedom. You should hire a financial advisor immediately and get some advice on how to save, invest, and spend your money wisely. The lump sum payment gives you the choice of what to do with your money directly.
What Should I Do With My Cash?
If you’re in a large amount of debt, you should definitely clear your debt immediately. This will keep you from (hopefully) sinking into further debt and even if you have limited funds left after, you won’t owe payments on your old debt. You should also look into smart investments and putting some in a savings account that can accrue serious interest over time. You always want to be investing in your future. Stocks, savings bonds, and other such measures could be very beneficial to saving your money and watching it grow. Additionally, a financial advisor, like mentioned previously, can help steer you towards wiser financial investments and a financial plan for your future.
In many cases, it may be a great idea to take the cash advance or lump sum to clear out any debt, and give yourself a financial head start on making a new financial future for yourself. Make the right choice and give yourself the chance you deserve to get out of debt.
Helpful info also found here.