If you have been involved in a rideshare accident, there is a high chance of getting compensation if you can prove fault. In most cases, rideshare insurance companies offer a good amount of coverage for their clients.
Therefore, if you file a claim and get compensation, you may be dealing with a large sum of money. Before you think about how you will use the settlement money, it is crucial to understand more about the settlement and who you might owe.
In a rideshare settlement, there are two options. You may get a lump sum or a structured settlement. You will receive the payments in bits over the agreed period in a structured settlement. With the other option, you get all the money at once. Both of these options have advantages and disadvantages.
Therefore, it would help if you reviewed each of them to know them better.
What Do You Do with the Money?
After coming to an agreement and settling for a particular amount, you may be excited about what you will do with the money.
However, you should be calm and talk to a rideshare accident lawyer who helped you get the settlement about planning to use the money. The lawyer will first give you a list of the deductions before you get the remainder. After dealing with the deductions, here is what you should do next.
Before anything else, seek advice on spending the money, especially if you have received it in a lump sum. Your lawyer or financial advisor should be the best people you go to for advice on how you should manage the money. The decision you make with the money can either build or ruin your life.
Therefore, ask a lawyer or financial advisor to assist you in strategizing how to utilize the money.
Most settlements are subject to tax if your claim includes lost profits, punitive damage, breach of contract, or back pay. Before you use settlement money from the lump sum, know how much you will be taxed.
Therefore, start with the taxes before spending what is left over.
Pay the Lawyer
Most lawyers operate on a contingency fee. You only pay them after winning the case or getting the settlement. Therefore, the lawyer will take their part before handing the rest of the money. Paying your lawyer is crucial since it keeps the excellent relationship going. Furthermore, you have an expert at your disposal if you need further guidance.
Have a Plan
Your financial advisor or lawyer will help you create a viable plan on how you will spend the funds. Make a list of the most important things you want to do and ask the lawyer to evaluate the list. Know how long you want the money to last and the things you have to pay for using the money.
If you were injured in the accident, plan how the funds will cater to medical bills.
Getting a fair settlement will provide relief after the accident. You will need to pay for any medical bills accumulated after the accident. You will also need to set aside some money to cater to the bills in the future.
So, after sorting that out, consider paying off any debt you might have, especially the high-interest ones. Your financial advisor or lawyer will help you evaluate the debts and decide which ones you should pay first.
Buy a Home
You can also decide to set aside some money for education. A college education is expensive, so you should set aside some of the money for that. If you do not currently own a house, buying one using the funds can also be a good idea. You can also clear the mortgage if you already own a house.
To Wrap It Up!
The goal here is to use the funds responsibly to improve your life now and in the future. Therefore, it is crucial to use the input of a lawyer or financial advisor before making any major decision with the money.
After paying deductions, taxes, and your lawyer’s contingency fees, plan how you will use the rest of the money. Don’t make quick decisions or go for manipulative opportunities. Take your time and make reasonable decisions with the help of a professional.
Thanks for reading! Please let me know your thoughts and comments below.
Top 10 Popular Posts Of All Time
- Top 30 Canadian Blue Chip Stocks You Should Own
- How To Use A My Service Canada Account
- How To Watch Free TV Shows In Canada – List of 10 Best Sites
- VGRO Review – Vanguard’s Best Growth ETF Portfolio
- Top 7 Canadian ETFs You Should Own
- Top 150+ Dividend Stocks In Canada – Complete List
- Credit Karma Canada Review – Free Credit Score And Report
- CPP Payment Dates – How Much CPP Will You Get?
- Top 5 High-Interest Savings Accounts In Canada
- How To Open A CRA My Account?
Sagar Sridhar is a personal finance blogger from Canada. His genuine passion for personal finance coupled with his unique style of writing is what stands out. Professionally, he is a computer engineer, agile certified and has a master’s degree in Project Management. His writing has been featured or quoted in the leading Canadian publications such as Credit Canada and many other personal finance publications. While he is juggling between his day job and blogging, he is the main author on this blog and has miles to go before making the final pit stop.