You can often pursue the compensation you may deserve by filing an insurance claim and negotiating a settlement. However, sometimes, individuals in your circumstances are so focused on seeking the compensation they may genuinely deserve that they don’t thoroughly consider how they will manage their funds when they collect them.
When you receive a personal injury settlement, it’s wise to make informed decisions that will ensure your long-term financial stability.
In the vent funds are recovered for a permanent or catastrophic injury, your attorney will guide you and your loved ones to help ensure trusts or other methods are employed to address future healthcare and life needs. However, other circumstances may allow for some flexibility in planning. These tips will help:
Cover Your Medical Bills
The main purpose of settlement money when you’ve been injured is to compensate you for losses resulting from an injury or illness.
This often includes medical bills. If you’ve been injured because someone else was negligent, you shouldn’t have to pay for the cost of necessary medical care. This is among the main reasons you might file a claim with the insurance of the negligent party who caused your accident. Such bills are often in the form health insurance “liens”, maintained by insurers during litigation to recoup moneys paid should your attorney succeed in securing a recovery. Typically, liens are know prior to settlement, and can be negotiated and paid prior to your distribution.
Pay Off Outstanding Debts
One of the first things you should consider doing with your settlement money is paying off any outstanding debts. This includes credit card debt and any other debts you may have incurred as a result of the accident.
Paying off debts can free up your income and provide some much-needed financial relief. This is particularly true if your settlement includes compensation for lost wages because you were unable to work while recovering from your injuries.