Should I get cash for annuity now? How good are lump sum annuity rates right now? Would I be better of taking cash for structured settlement payments? Is getting a lump sum better than waiting for annuity settlement payments? These questions will be familiar to anyone struggling to decide between taking an annuity vs a lump sum.
So what’s the best financial decision for you? There are no easy answers, and so single path to a secure financial future. However, we can make the decision a little bit easier for you. Over at the American Association of Retired Persons (AARP) website, one of the organizations financial writers tackles this age old question, cash for annuity now, or fixed annuities?
If you’re considering selling a structured settlement, annuity, or lottery winnings for a lump sum, than the situation isn’t exactly the same. Specifically, the AARP is examining a 2012 decision by Ford and General Motors to offer pensioners a choice between their annuity pension payments and an upfront lump sum. To make a long, complicated story slightly less complicated, the auto companies thought they could save money in the long run by taking lifetime pension payments off their books. That left many retiring workers suddenly calculating lump sum annuity rates to decide what was best for them.
It’s a complex process. For the millions of Americans in debt, that lump sum can be an attractive offer. Today, the average U.S. household in debt has about $15,355 in credit card debt and $129,579 in total debt, while 26% of Americans struggle to pay bills on time. If you can sell annuity payments or opt for a lump sum, many of those problems could go away.
And for some people, rather than waiting for payments, they can invest the lump sum in a variety of financial products, which will eventually help them maintain financial security in the long run.
Choosing whether to take an annuity or lump sum is a big decision, and one that shouldn’t be taken lightly. Always check lump sum annuity rates to determine exactly how much you would be getting up front, versus how much you would get in the long run with annuity payments. For help arriving at a decision, consider hiring a financial advisor.
