It seems like every channel I turn on has these television commercials advertising the annuity action network. All they want me to do is to sell my annuity payments for cash now. Is that a good idea?
No. It’s not a good idea at all. Unless you have to absolutely sell or transfer your payment rights we would advise against it in general unless we are able to take a deeper dive into your financial situation and the reason in which you want to trade a stable source of cash flow in exchange for a lump sum payment.
Selling Annuity Payments Advice
When it comes time to decide on whether or not to sell your annuity payments for cash now is a big financial decision that can affect you for years after the transaction takes place. We want you to make a decision based on facts rather than on biased television commercial jingles and interests that don’t serve you or your family. Here are expert opinions on why you shouldn’t sell your payment streams below.
Selling Your Annuity Payments is a BAD Idea….
Okay. So I understand selling is a bad idea but can I actually do so if I really wanted to?
While it is your money and you can do as you wish with it. We want you to remember that you ended up with this annuity for a reason. The reason was to give you a stable source of income and most likely the intention was for you to never transfer the rights for it. If your financial situation were to change and your monthly financial needs exceed what your income is bringing in than it may potentially make sense to sell a portion of your periodic payments and take a one time lump sum cash pay out. You don’t have to sell the entire payment stream and we would recommend only doing a very small portion to get the extra money that you need if you can’t come up with it from another source. This also allows you to continue receiving your future annuity checks despite selling a percentage of your monthly, quarterly, annual, or future funds.
What’s The Best Alternative To Not Selling My Annuity Payments?
Do you have a Chartered Financial Analyst that helps you with your investments? If you do work with a CFA or private banker they can help direct you with alternative lending options. We suggest only working with licensed experts who have good reviews and can provide at least 5 recommendations from satisfied clients on how they helped to manage their funds and financial situation. We provide an opportunity here at 500Cashout.com that’s an alternative to selling to companies like J.G. Wentworth where we can provide you with $500 for not selling but rather for discussing your situation with us via a Zoom, Google Hangouts, or Facetime call. We can discuss the drawbacks of an early sale compared to what may be less detrimental selling off your 401 (K), Stock Portfolio, Whole Life or Term Insurance Policy, or one of those mailers you probably received today for a high interest loan against your business. While each of these scenarios provides relief you must also examine the tax consequences of entering into any of these transactions as well as the time it may take to get the capital that you need.
Whats the Least Amount I Can Sell of My Annuity?
You got a contract sent out and you signed to sell but you still feel in the dark right? If you want a big fat stack of cash then you would’ve opted to sell the entire thing. This may be because you want to buy a house, pay off bills, or just need money for an emergency. You can sell off payments that will yield you just a few thousand dollars if you want to do the minimum sale. You can sell by periodic payment period or by amount of dollars received each time the payment comes. For example if it’s $500 a month you receive from AIG you can sell off $50 a month and still receive the other 90% of your payments each month after the transaction has been completed.
Are There Any Benefits of Selling My Annuity Early?
In some rare cases selling your annuity payment rights early will give you the cash you need to re-invest into yourself. If that does happen then consider yourself one of the lucky ones. There are more cases of wealth being pilfered away versus creating a better life for yourself. If you decide to sell early you are going to lose out financially unless you re-invest into a better future for yourself, you can beat a 5% return, you can grow the money to a much bigger amount, or you have a true best interest case to go back to school, pay off bills that need to be paid, or you need emergency cash. In those cases you do have a benefit to an early sale but it’s rarely a great financial decision and we want to warn you about the risks of improper fiduciary actions.
Can I Legally Sell My Annuity Payments
If you have a SPIA or another type of annuity that you want to cash out then you can consult with our team to determine who the annuity is registered to and the process that would be involved in transferring the annuity. If you are the right holder or recipient then the answer is most likely yes but if you are not then you wouldn’t be the one legally transferring your payments. Selling your annuity is different than a sale or transfer of your structured settlement payment rights. The biggest thing to remember is to ensure that it’s a transaction that makes sense. If it’s not in your best interest than don’t expect the transaction to be approved. Your loved ones and your own financial interest is looked at by the court and our team to make sure you make the right decision based on your needs.
How Does the Selling Process Work?
As you research on whether or not you should sell your annuity payments, we recommend that you evaluate your financial situation and determine if this truly is in your best interest or if you can hold off and just use our 500 cash program to help you get by.
Selling your annuity payments will involve multiple steps:
- Determine the reason why you need to sell
- Seek out potential alternatives to selling
- Talk to a CFA and CPA about your interest in selling
- Reach out to an investment banker to see if they can offer assistance or alternative loans so you don’t have to sell
- Once you have resorted to all other options and have no choice than get a quote to sell your annuity
- Sign the paperwork based on the quote to receive your funds
- Cash in your annuity and put that money to good use
We will provide an in depth annuity pros and cons guide so you can determine whether this is right or not for you.
I’m Ready To Receive a Quote How Long Does it Take?
Good news. It doesn’t take long and will not cost you a penny. In fact you can get $500 for a consultation about selling your payment rights. It’s a complex sale process and the numbers can often get confusing so we want to speak with you to warn you of the risks and rewards involved with doing a transaction after you get your quote. We ask that you get numerous quotes to compare and contrast the different companies.
Once I’ve Sold What Happens?
If you got your lump sum of cash then you should be spending that money on the intended cause that you said you were going to spend it on. Is it on college tuition, taxes, medical bills? Whatever it is you need to do the ethical and right thing for you and your future and pay up for what you said you were going to. If you sell your entire annuity remember there is something called the time value of money where money today is not worth the same as it is in the future. There will always be a discount rate that will range in great deal when doing a transaction to sell your payments. Remember that you can and should discuss this with a tax attorney, CFA, and or CPA to fully understand about the risks of the transfer or sale.
Can I Get My Money the Same Day My Deal is Approved?
This is the most common question we hear. How soon can I get my money? We will fund your deal as soon as the insurance company provides us with the proper documentation to do so. We have to work with them to process the paperwork and during covid-19 you can potentially expect delays. We are glad to advance you funds against your annuity for immediate bills that need to be paid. Everybody’s financial scenario is different and we understand that so we’re glad to work with you and get you the financial help that you need in a very timely manner.
The Types of Payments You Can Transfer or Sell
What Annuities & Settlements Can’t I Sell?
You may not like hearing this but not everything can be legally transferred or sold for a lump sum. Unless you live in New Mexico you can’t cash out your workers compensation payments. If you are receiving a government pension then guess what? You can’t sell that off either. Same goes with disability payments & social security. Most state laws will prohibit the sale of government pensions and aside from the fact that we recommend you hold onto these you can consult with a lawyer in your state to see whats legal and not to transfer.
Inherited an Annuity and I Want to Sell It
You Sound Great What Can’t You Buy?
What Are The Expenses Associated With Selling An Annuity?
Think of your annuity payments as an investment. There’s a downside and opportunity cost to selling your investment too soon. There are going to be tax implications and fees charged by any company for processing the transaction. This will range based on how many television commercials the company is running as they need to make up for that advertising expense. This income will be taxed when you sell your payment. The tax year will be based on when you received it. So if you receive the pay out in 2021 than that is when you will be taxed for that specific year.
How High Are the Selling Fees?
We will round out our in depth annuity sale guide with the bad news you probably don’t want to hear. The fees will add up. From the lawyers who draft the documents and represent you in court to the notary who will have to have you sign the contracts it all costs money. You still need to appear in court or on Zoom (depending on the county and courts rules at the time of the hearing). The biggest fee of all though is called the discount rate that you’re taking in exchange for getting your money now. Interest rates will change depending on numerous factors. We want you to consult with a financial advisor, CFA, or tax attorney to work through this transaction and determine if ultimately you need to sell or if you can utilize our $500 cash program and revert to not having to sell.