Pat-Farber-Advantages-Structured_Settlements_injured_minorsWhen a child is injured, parents have much to think about. High on the list is the child’s financial needs during the initial recovery period and beyond for medical, rehabilitation and other experiences.

If there is compensation for the injury, judges often require that the settlement be structured so the best interests of the minor are front and center. Why do judges think structured settlements are so critical for an injured child? Here are some of the reasons.

Payments can be customized. Regularly scheduled payments can be arranged to meet the child’s needs—to pay for medical bills, schooling and living expenses.

Settlement proceeds can’t be squandered. For parents who may not have the investment experience necessary to suddenly manage a large sum of money, a structured settlement is often the best option. Parents won’t feel the pressure to give in to unscrupulous individuals who see the settlement as their own piggybank. The settlement funds are placed in safe, secure annuities from an A or A+-rated insurance company—out of reach of dubious friends and relatives.

Provides a sense of security. Knowing that funds will be there to provide reliable, guaranteed, tax-free income during childhood and, if necessary, through adulthood, is often the greatest benefit of a structured settlement.

Funds will be there for a lifetime. In the case of a seriously injured child, settlement proceeds for long-term medical care and living expenses must last after parents can no longer care for the child. A structured settlement ensures guaranteed payments will be there for the child’s long-term wellbeing.

Pays for college expenses. Payments can be timed to pay for tuition, books and fees as well as monthly living expenses while the child attends college. Or, payments can be scheduled for just after graduation to pay off college debt. By not having to declare the settlement funds during the child’s college years, he or she has a better chance of qualifying for financial aid.

Ensures mature, financial decisions are made. Without a structured settlement, an injured child can legally request (and receive) the settlement proceeds at the age of majority, usually age 18. With a structure, parents can delay the child’s receipt of the funds until the child is more (hopefully) mature to make sound financial decisions.

For more about structured settlements for minors, go to a video by attorney Virginia Nelson. Virginia provides a quick overview of the advantages of structures, especially for a seriously injured child. Or, feel free to call me to discuss structuring options.


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