24 Sep 3 Exciting Way to Use the Money from Selling an Annuity
The first thing you think about when you receive any type of structured settlement annuity is whether or not you want to wait and collect the annual payments, or collect instant cash by selling your annuity settlement. The conservative investor will tout the benefits of a long-term, reliable source of income. Those with a bit more gumption, however, will note the vast potential the significant amount of cash provides you. On average a structured settlement will pay out $324,000. If you’re in sound financial standing as it is, there’s no reason to not benefit from the assets available to you. Here are three things you might otherwise not be able to afford by selling your annuity.
1.) Upgrade Your Living Space: Whether you’re renting or paying off a mortgage, selling an annuity settlement gives you the freedom to change residences with relative ease. You could put it towards a down payment, use it to pay your way out of a current lease, or invest it into your home if you’re already a homeowner. Adding a pool, central air units, and professional landscaping are just some of the ways to build equity on your house. Don’t think of it as selling payments; think of it as bettering your current investment.
2.) Vacation: It would be foolish to talk about new found wealth without mentioning at least one ego-driven luxury. You don’t have to blow the whole check on an all-expense month-long trip across Europe, but putting a little bit aside for a relaxing trip for you and a loved one is more than reasonable. According to one study, 92% of respondents were satisfied with their decision to sell a structured settlement of some kind. Chances are you’ll be part of that majority if you elect this option when the time comes.
3.) Riskier Investments: Perhaps the best thing you can do with the money you get from selling your annuity is investing it into other areas of the market. Make your money, make money. Most people have to stick with conservative options like savings accounts, bonds, and certificate of deposits. With the extra money you’ll be able to play with riskier investments are not only possible, but plausible. Stocks are a common option that offer greater potential returns, but there is the risk of losing money on them. Put aside a portion of the money you get as your ‘big risk, big reward’ section and get a little adventurous playing the market. Remember, professional consulting is always available and recommended for novices in such matters.
Don’t forget, if you choose not to sell your annuity there can be penalties for withdrawing from it early. Most annuities will slap you with a 7% charge of your investment if you take out any money in the first five to seven years of its creation.