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Son and Family

Structure Strategies

A Son’s Special Thank-You After 25 Years

Keith and his wife, Liz, recently received a special gift from their 30-year-old son, Dan. He took them on an all-expenses-paid vacation as a way to say thank you for their foresight more than 25 years ago!

On Dan’s first day of preschool, another toddler accidentally poked him in the eye with a toy hockey stick. Dan recovered, but his sight was permanently damaged in his left eye. Keith felt the preschool was partially responsible for the accident and hired a lawyer. At settlement, Keith and Liz decided it would be in Dan’s best interest to set up a structure to make lump-sum payments to Dan every year starting at age 18. Dan used the money wisely over the years to fund his education, start a family, and buy a house. Today, he is a successful architect with a lovely wife and two young children of his own.

“I wanted to thank Mom and Dad for giving me a good start in life,” Dan said. “So I used part of my last payment and took them to a beautiful lakeside resort for a long Father’s Day weekend. They were definitely surprised by it all, but I think they are proud of me.”

(Note: While Structure Strategies is based on actual case histories, the names and images of the people involved have been changed to protect their privacy.)

We Want to Pump You Up

... And Maximize a Settlement's Future Impact

barbell guy

In a nutshell, the Barbell Strategy advocates for staying away from middle-ground investments and investing instead in a combination of very safe positions paired with very aggressive ones. It can be done in stock or bond investing, but perhaps the best application is SETTLEMENT INVESTING. Here’s how ...

Peanut Butter and Jelly?

Combine the safety of a structured settlement with an investment account that can be managed more aggressively BECAUSE the structured settlement provides capital preservation and immediate income needs. Along with all wounds, time also heals market volatility. Having a structured settlement that satisfies income needs – particularly during the first five to ten years of a settlement plan – allows the investment side of the barbell to perform with a much lower risk of poor market timing. As time passes, the investment side can be called on more and more to provide for future needs, thanks to the underlying guarantees provided by the trusty structured settlement.

But Wait, There’s More!

Clark Kent wasn’t much to look at, but underneath it all was someone who could more than get the job done. A structured settlement is a bit like Superman. They’re not flashy or complicated, but they are powerful and quietly get the job done. In basic Barbell Theory, the safe money side’s job is to preserve capital, not perform - that’s the job of the aggressive side of the barbell. But like our friend Clark, the structured settlement has some superpowers:

  • It’s bulletproof (tax-free).
  • It can leap tall buildings on a single bound (there are no ongoing sales charges to hold it down).
  • It’s faster than a speeding train (interest rates are fantastic now).

When it comes to resolving a matter that involves future needs, both trial attorneys and claim professionals are finding that structured settlements can be the superhero when it comes to finding a solution.

Avoid Lukewarm

Barbell Theory says to avoid the middle ground, as in the moderately conservative or the moderately aggressive. The reason is that the return just isn’t high enough relative to the risk. Wealth Managers and Financial Planners often fail to recognize that a structured settlement can be considered an “asset class” and not just a product they need to compete with. They usually construct balanced portfolios that include not-insignificant positions in middle-ground type investments, a.k .a. lukewarm stuff. Because of the effect of taxes and ongoing investment management expenses, their NET return relative to risk is considerably lower than that currently available in structured settlements.

Throw Caution to the Wind?

No. The answer here is that the solution lies in the artful and scientific combination of a structured settlement and investments that can be managed more for growth than income. Create a structured settlement to answer income and capital preservation needs. Pair it with a portfolio that can be more aggressively managed because of the underlying strength of the structured settlement. The result can be something impervious to all the Kryptonite the future may hold for our accident victims. If you’re having difficulty finding a superhero who can lift this barbell and simplify the process for all involved, look no further than your friendly neighborhood Ringler Settlement Advisor. You’ll find them quite Marvelous.