Too many people in Illinois are victims of serious accidents which are not their fault. After these accidents, they may recover money for their medical bills, lost wages and other costs through a personal injury lawsuit or negotiation .
In major accidents or fatalities, victims may recover hundreds of thousands if not millions of dollars.
At this stage, a victim want to engage in some careful estate planning which will apply both during their lives and after they die.
After all, personal injury recoveries rarely are tickets to instant wealth; people receive compensation because they and future generations will need it.
During a victim’s life, there are a number of financial options
There are a number of ways a person may want to structure his or her settlement in order to maximize income. Some of these options are more controversial than others. For example, some companies offer advances on proceeds from pending lawsuits.
Of course, these companies expect repayment, and a profit, after a lawsuit concludes.
After a settlement, a person may want to consider an annuity. Basically, an annuity involves a person paying up front for the right to have a guaranteed steady stream of income for a number of years.
The important thing to remember is that these financial agreements are legally binding contracts involving a lot of money. A person should review them carefully and understand the consequences of signing them. She should also explore possible alternatives.
A victim may need to prepare other estate planning documents as well
At a minimum, after receiving a large settlement, a personal injury victim, including a grieving family member, should at a minimum update his will, power of attorney and other estate planning documents.
In many cases, it may be important to consider forming a trust or using another estate planning technique.
If the victim is a minor, it may be necessary to create a guardianship.