If you have been awarded a large amount of money through a lawsuit or if you won the lottery you may be considering your payment options. Generally structured settlements and lottery annuities provide a certain amount of money yearly, but sometimes life has other plans and a yearly payout does not happen soon enough to make ends meet.
Receiving Payments From a Lottery Annuity?
If you win the lottery you may be surprised with how much you actually receive. Right off the bat, the lottery withholds 25% for federal tax, then, depending on your state and your tax bracket, another 6 to 9% is taken for state taxes. Even your pay outs can vary in amount. Mega Millions is paid out as one immediate payment followed by 29 annual payments with each following year’s payment about 5% bigger than the previous one. Similarly Powerball’s payout schedule consists of 30 annual payments that increase over time. That means you would receive your total winnings over the span of years.
Receiving Payments From a Structured Settlement Annuity?
If you were awarded money from a lawsuit you may want to consider your options. More than 37,000 Americans use structured settlement money every year. The average structured settlement payout is about $324,000, but that does not mean you will be receiving your money any time soon. By the end of 2013, there were 34.8 million individual deferred annuity contracts exceeding $2.58 trillion.
If I Need Money,Can I sell My Annuity?
If you won the lottery or a structured settlement and you need extra money to buy a house or a new car or for emergencies you may ask, can I sell my annuity. This in fact is a valid option. Over ninety-two percent of claimants who sell their structured settlements report that they are satisfied with their decision. If you are in a situation where you can’t wait for your payments, selling your annuity may be an option. Immediate annuities can generally start paying out in about 30 days. But receiving money quickly can come at a price. Keep in mind that selling off an annuity can incur surrender charges of up to 10%.
