Do You Need a Financial Advisor To Help Manage Your Lump Sum Payout?
Here is a fact: very few people have any idea of how best to handle sudden, large sums of money.
We’ve all have heard stories of how some lottery winners find that instead of their dreams coming true after they cash in a winning ticket, they instead wind up broke and in debt because they didn’t know how to deal with their new-found wealth.
That doesn’t have to happen to you. If you do come into a windfall of cash, you might consider setting up a structured settlement or an annuity. One of the advantages of a structured settlement or annuity payments is the built-in protections it offers to help you use your money wisely. By distributing regular payments in relatively small installments over a period of time, it prevents the recipient from running through the money due to a lack of financial experience.
- Paying off debt
- Purchasing a home
- Starting a business
- Taking advantage of an investment opportunity
- Setting up a trust fund for family members
- Financing a college education
Even if you do have a clear plan for your lump sum payment, it’s still a good idea to enlist some professional guidance. A certified public accountant (one who is not a personal friend or relative) is your best first choice. If you can find one who is also a licensed to practice law, so much the better. Someone with dual credentials like that may not come cheap – but his or her services can be well worth it. Consider it an investment in your financial future.