Some injury victims see a personal injury settlement or award as something akin to winning the lottery: once they receive their settlement money, they never have to worry about their finances again and can live a life of ease and comfort. But just as some lottery winners have found themselves in financial need several years later, so too injury victims who receive a large settlement can quickly find themselves in dire financial straits. This can be a perilous position, especially if you have a family to support and are unable to return to the workforce or cannot earn as much as you used to.
Prudent Planning is Key to Financial Success
In order to make your injury settlement or award last, you must take proactive measures.
One of the best ways to make your money go farther is to learn how to budget and stick to that budget. If you are unaware of how much money you spend each month or where that money goes (i.e., does it go to pay necessary bills or does it go to other things you do not need?), it will be difficult for you to get a handle on your finances and set aside enough money for bills, ongoing medical treatment, family expenses, and other such costs. If you do not know how to budget, there are a variety of apps and community groups that can offer you assistance in setting up a budget.
Consider putting some of your settlement money into an investment like a 401k or a mutual fund. These types of investment vehicles may not provide as large a rate of return as some other investments, but they do provide a rate of return on your investment over the years that is at or above inflation. This can help ensure that you will have money later in life. It is advisable to speak with a financial planner or other investment advisor to determine what course of action is right for your situation.
Be prepared for possible tax implications in the taxable year in which you receive your award or settlement, and be certain to budget for the payment of these taxes. A tax professional can evaluate your situation and advise you of your tax liability.
Other Resources to Make Your Dollar Go Farther
If you are young and suffer from a long-term disability or condition, you may be entitled to certain scholarships to help you attend or go back to college. There are also scholarships available to the children who have a parent who is disabled. These do not cost any money to apply for and can make your settlement or award go farther by taking care of certain expenses so that you do not have to use your settlement or award money.
If you do find yourself facing financial difficulty, various civic and religious organizations may be able to provide you with monetary assistance to help you meet your bills and pay for necessary treatment and medications. Some of these may have a lengthy application period, so it is best to reach out and ask for assistance as soon as you believe you may need it.
Things Not To Do With Your Settlement or Compensation Award
Just as there are certain things you can do to make your settlement or compensation award last as long as possible, there are certain things you can do that will almost guarantee your award money will be gone before you know it:
- Do not gamble your settlement or compensation award. Some people believe gambling with their award will pay off and make their award even larger. Stick to 401ks and investments if you are wanting your award dollar to go farther.
- Do not spend your compensation on frivolous purchases or vacations. Remember, the compensation is there to help you meet expenses that you now have because of your injury.
- Be very cautious about offers to buy your structured settlement for cash. If you agreed to a structured settlement (wherein the defendant pays the settlement award in a series of installments over time), be very careful about offers from companies looking to pay you “cash now” as the amount they will pay will typically be far less than what your structured settlement would be worth.
Ladah Law is Here to Help
At Ladah Law Firm, we help you provide for your family by striving to obtain the largest settlement or compensation award possible. We do this by thoroughly investigating your case and zealously advocating on your behalf throughout the injury claims process. Learn how we can help you provide for your family after you have been injured by calling us at (702) 252-0055 and setting up a free initial consultation for your accident case in Las Vegas.
Ladah Law Firm, PLLC
Las Vegas, NV 89101