What Is A Structured Settlement For A Minor

Other payment options for minors exist including trusts and guardianship accounts.

What is a structured settlement for a minor.

A structured settlement does operate in this way. The child and his or her parents know where the money is and in case of an emergency medical bill related to the original injury settlement the court in its discretion can approve a disbursement of the money and it can be withdrawn from the bank. Structured settlements are regulated by insurance companies. Settlements involving minors introduction.

Structured settlements can be used to finance college educations by providing a certain sum of income each year that the child would attend college. Litigation involving someone under the legal age imposes requirements as to how any settlement is to be achieved and distributed. Under the laws of virtually all states now you may not take the funds from a large settlement usually over 5 000 on behalf of your minor child and invest it yourself. Court approval is required for all settlements involving minors no matter how small the sum.

Numerous options provide steady income throughout the minor s life ensuring living expenses education and. Structured settlements for minors are usually paid through an annuity from a life insurance company just as for adults. The key difference between an adult owning a structured settlement and a minor owning one is control. Choosing a structured settlement for a minor may also speed up court approval because this arrangement is designed to protect minors interests.

A structured settlement is one of the safest financial tools out there. This is set by state law and is the topic of this article. Please seek the advice of a qualified professional before making financial decisions. It is usually arranged to begin when the minor reaches the age of majority which can differ depending on the state you live in or sooner if the proceeds are paid into a trust account.

Structured settlements are considered ideal for ensuring that an underage child s cash settlement is preserved and spent appropriately. Structured settlements can provide payments timed to. Structured settlements reduce the risk that anyone will embezzle misuse or withhold large sums of money belonging to the injured claimant. It is a good idea to check with the court for any particular practices followed by that court in approving minors settlements.

Structured settlements for minors.