Let’s face it, most Americans are woefully behind in saving for retirement. And it’s not just Millennials who have little money left over to add to their 401(k)s (with loan debt, high housing costs and low wages being the culprits). Baby Boomers and seniors, those who should already have a sizable nest egg, are coming up short. Statistics bear this out. A recent GoBankingRates.com survey found that 28 percent of those age 55 and above have no retirement savings. Seventeen percent have less than $10,000 saved.
When negotiating a settlement for someone who is personally injured and of working-age, retirement planning should always be a discussion topic. For those who have had their working years interrupted because of an injury, or worse, are unable to work at all, planning for financial security during later years takes a heightened importance. That’s where a structured settlement can help.
Here are some options. Individuals who are able to return to work after an injury can choose to receive all or a portion of the settlement funds during retirement to supplement Social Security income. The settlement funds grow tax-free in the annuity investments until they are withdrawn. Those whose injuries are so severe they are unable to return to work will likely receive an ongoing income stream, but can also designate lump sum payments in retirement years to pay for anticipated increases in medical or living costs. Injured parties also have the option of structuring payments so they steadily grow based on the inflation index.
Saving for retirement is hard enough when someone is healthy. It’s even harder if an injury impacts the ability to earn and save. Structured settlements enable retirement to be financially worry-free.
Please contact me with any questions about using structured settlements as part of retirement planning.