by John Darer
According to a recent article by MSNBC entitled "The Dark Side of Financial Windfalls", "financial experts and recipients of unexpected sums of money say it’s common for such newfound wealth to feel more like a burden than a blessing — especially if the windfall came as a result of a loved one's death."
Some windfall recipients, a category which includes, among other things, those receiving proceeds from insurance claims or lawsuits , "impulsively quit their jobs or leave their spouses even though they haven’t come into enough money to make them independently wealthy. Others spend the money far too quickly without planning adequately for the future — or for the taxes they don’t realize they owe."
When it comes to legal claims and law suits there are often critical time sensitive decisions that must be made. Working with a competent settlement professional or settlement adviser, for those with legal claims or lawsuits, is a good way to get your arms around the issues. Attorneys for plaintiffs should also consult a settlement professional to help with the closing process. A Registered Settlement Planner can provide valuable input, experience based knowledge and other services to help all parties, particularly the settlement recipients and their attorneys.
Another aspect of financial windfalls mentioned in the MSNBC article and something I have observed over the years is that some "experience a paralyzing fear of doing something wrong with the money — and, as a consequence, they waste" time, even "years doing nothing at all. And most experience a change in relationships with family members and others they have loved and counted on for years." Experienced settlement professionals may be able to help such individuals by drawing on their experiences with others.
Some structured settlement payment recipients are targeted by certain predatory factoring companies seeking to induce them to sell their structured settlement payment rights. While there seem to be legitimate places for such transactions (for example the testimonial examples recently posted by Rhonda Bentzen on her weblog), misleading expectations created by the misleading advertising and high pressure sales tactics by some of Bentzen's competitors are encouraging a needless step to the same dark side cited in MSNBC's article. Such individuals should contact a financial professional who will take the time to help them evaluate the transaction and other alternatives that may be available.
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