Structured Settlements – Should You Sell Yours?Written by Charles Essmeier
In recent years, it has become more common for victims of accidental injury who accept a settlement from at-fault party to accept a structured settlement instead of a lump-sum payment. With a structured settlement, injured party receives payments over an agreed-upon length of time – five years, ten years, or even a lifetime, rather than receiving payment up front in a lump sum.
There are advantages to this for both parties. The injured party may require constant medical care, and regular payments of a structured settlement guarantee that income will be available to cover medical expenses. For paying party, settlement can be paid by purchasing an annuity, which allows an upfront payment to accrue interest, thereby producing a larger long-term yield from a minimal investment. In many cases, a structured settlement is viewed as a win-win situation for both parties.
There are restrictions on structured settlements that may not suit everyone. Once you agree to accept a structured settlement, you cannot trade it back in for a lump sum payment, nor may you use it for collateral for a loan. What if you want to buy a home and pay cash? What if some other unexpected expense comes up and you simply do not have cash available? Under certain circumstances, you may be able to sell your structured settlement to a third party.
There are companies that are interested in purchasing structured settlements for investment purposes. Perhaps one or more of these companies has already contacted you. They will agree
| | Mutual Fund Expense LiesWritten by Al Thomas
MUTUAL FUND EXPENSE LIES When purchasing mutual funds we are cautioned to read prospectus, look at past performance, check out fund manager’s record and see what their expense ratios have been. We are also told that we should not buy funds with expenses exceeding 1% to 1.5%. When you ask fund salesman (don’t forget he’s a salesman) he will assure you that fund expenses are whatever is shown in prospectus. He is telling you truth, but not whole truth, according Securities and Exchange regulations. In many cases he has left out a big chuck of expenses. The 1.5% expense means you are paying $150 each year of every $10,000 you have invested with that fund. The lower expense is more of your money is at work. As a fund becomes larger meaning they take in more money expense ratio should drop, but it rarely does.he fund manager must make 1.5% to have your money stay even. If you can find your way around Securities and Exchange Commission internet web site you will find that definition of expense ratio leaves out commission charges. Many funds will turn over their portfolio by 100% in a year. Obviously they are not going to buy and sell at no charge. The floor broker must be paid a commission for each share that is executed. Sometimes brokerage fees are purposely inflated and broker kicks back favors(they don’t call it that) such as research information, free
|
