The Benefits of Selling a Fixed Annuity

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Cash for your structured settlement

If you have an annuity from a court settlement or lottery winnings, you may want to consider selling it.  Maybe those payments coming in over a longer-term seemed like a great idea, it is reliable income but maybe that isn’t the best way to get that money.  Selling fixed annuities is a great option for a lot of people who need to use that cash in the shorter term.

Reasons for Selling Fixed Annuities

Purchase a Home or Make Home Improvements: Homes frequently increase in value over time.  Some sell a fixed annuity and use that money to buy a house without a mortgage.  The average mortgage lender will require a downpayment of 5, 10 or 20% of the price of the house and this has to be cash.  This is the most expensive purchase most people will ever make.  In 2010, the average price tag on a new home was $272,900.Others use it to make improvements on the house they have, increasing its value — either when selling it of if the homeowner ever should need to take a loan out using the house.

Go Back to School or Send Your Kids to College: Maybe you want to continue your education to further your career or want to send your kids to college.  Both are expensive. Having a structured settlement annuity may disqualify you for financial aid.  This may prevent you from getting the degree you need to move ahead in your work or force your children to take out costly student loans.  From 2014 to 2015, outstanding student loan debt jumped from $1.21 trillion to $1.31 trillion.

Start of Grow Your Small Business: Do you want to start a new business? Do you have your own business?  It’s expensive to launch a business. According to the Kauffmann Foundation, starting a new business can cost $300,000. The lack of capital forces many small businesses to shut their doors.  You can use the money you make by selling your annuity to grow your business and make it a success.

Help Improve Cash Flow:  If you are like most Americans, you have debt.  Selling an annuity settlement can give you the cash to pay off that debt.

Diversify Your Portfolio: For some people, leaving the annuity alone for decades, while receiving smaller payments regularly makes sense.  For others, that money can be used better now.  This doesn’t always mean spending it.  It can be invested to create a more diverse portfolio that can increase in value the way a fixed annuity cannot.

More About Debt

The vast majority of Americans are in debt. The total amount of consumer debt in the United States is $11.3 trillion.  In terms of the average American household, adults owe about $70,000 for their mortgage, $11,000 in student loans, $8,000 for their car and nearly $4,000 in revolving debt.  Most American families have 13 payment cards and 40% spend more than they earn and many don’t have any savings. In February 2015, the average number of bankruptcy filings was 3,422 a day.

Medical debt is a huge issue in the United States.  The American Medical Association has reported that a whopping 62% of bankruptcies are caused by medical bills.  More than 20% of credit scores are negatively impacted by overdue medical bills. Most Americans are one accident or illness away from bankruptcy.

Many people could get themselves out of costly debt by selling fixed annuities.


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