Some say trusts, some say Structured Settlements. I say, why not both?
When an attorney is contemplating a settlement for their client, one of the most critical aspects of the settlement is economic sufficiency, particularly in catastrophic and wrongful death cases. In other words, is this recovery going to be sufficient to take care of an injured person or their family? In the past, it was often a discussion of whether to choose managed funds like a trust or a structured settlement, which has always been a false dichotomy when one considers that blending a trust with a structured settlement can be the optimal outcome for future financial needs.
As settlement consultants we know the strength of a Structured Settlement comes from the ability to precisely and cost effectively pay for future medical care or replace future income on a tax-free basis. It can pay for a period certain or for life and can be combined with a trust on an integrated basis to better address their needs, including income, security, flexibility, and growth. By managing structured settlement payments into a trust, the trustee can focus solely on investments that increase liquidity and appreciation while benefiting from the tax-efficient nature of the plan.
Most adults can manage their own financial affairs, but injured claimants and their families are in a unique situation. Modern settlement theory puts the focus on the need for economic sufficiency in a much more holistic way. Structured settlements blended with trusts present a unique opportunity to add significant financial value to the settlement. The best settlement is the one that meets all an injured person’s needs today AND tomorrow.
![Author-Photos-JohnM John McCulloch](https://teamarcadia.com/wp-content/uploads/2023/05/Author-Photos-JohnM-300x300.png)
By John McCulloch | Structured Settlement Consultant, Vice Chairman
John holds an MBA from the University of Phoenix, a JD from Kaplan University, and a BA in Business from St. Martin’s College. In addition, he has completed graduate studies in Electronic Commerce at the University of San Diego and holds the following professional designations: CSSC, FLMI, WCLS, AIAA, ACS, and CMSS™, as well as an accounting certification from the Department of Defense. His formal insurance training includes casualty, property, fidelity and Workers’ Compensation claims, as well as Life and Health underwriting.