The Wealth High Wire | Navigating a Large Legal Settlement

Did you know that approximately 13% of Americans live with a disability, many of which result from accidents leading to substantial legal settlements? These settlements can significantly impact your financial situation, offering both relief and a need for careful management. Here’s how to handle this sudden wealth wisely and ensure it benefits you in the long term.

Properly Structure Your Settlement

The first crucial step is to structure your settlement correctly. Collaborating with financial advisors and legal professionals can help ensure that your settlement aligns with court orders and legal requirements. Proper structuring not only reduces risks but also helps in maximizing the benefits of your settlement. It can offer protection from creditors and provide a reliable income stream, making it easier to manage your finances.

Understand the Terms

Before the funds arrive, make sure you fully grasp the terms of your settlement. Settlements can be received as a lump sum or through structured payments over time. Understanding these details is essential for effective financial planning. A lump sum offers immediate access but requires careful management to avoid overspending, while structured payments provide steady income, helping you budget for long-term expenses.

Strengthen Your Financial Foundation

Once you receive your settlement, focus on securing your financial base. Using part of the funds to pay off high-interest debts can alleviate financial pressure. Investing in assets such as real estate or stocks can offer long-term growth potential. Additionally, plan for any future medical expenses and establish a sustainable distribution plan. This plan should align with your overall financial strategy, ensuring that your settlement supports your lifestyle and future goals.

Update Your Estate Plan

A large settlement often impacts your estate planning needs. Review and update your estate plan to address changes in your financial situation. Consider who will manage medical decisions, guardianship for dependents, and how your assets will be distributed over time. Proper estate planning ensures that your wishes are honored and your assets are distributed according to your preferences.

Transform Your Financial Trajectory

Managing a large settlement effectively can transform your financial future, providing stability and new opportunities for growth. With thoughtful planning and professional guidance, you can turn this windfall into a lasting legacy. By making informed decisions and leveraging expert advice, you can ensure that your settlement benefits both you and your loved ones for years to come.

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Written By: Eric Ashburn, CFP?, CEPA?, CDFA?, CeFT? Partner and Private Wealth Advisor at Argent Bridge Advisors