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"And Now, the End is Here "

Nearly every story in America can be started with a line from a Frank Sinatra song. No, no one is dying here this month but the opening line of Frank's hit song “My Way” comes to mind for me every year about this time.

Living in upstate New York as I do, one comes to appreciate the changing of the seasons. Indeed, it’s one of the things I love about living here: you get a full dose of all four. As much as I do enjoy the changing of the seasons what I really enjoy deep down in my soul is summer and as the title of this month’s edition reflects we are at the close of this magnificent season. I’m sure it’s just the kid in me, but these shorter days, cooler nights, and the changing foliage saddens me a little, it feels like an “ending”.

Seasonal changes seem big to us as kids, but as adults the years seem to fly by. Someone once explained to me (very mathematically) why this is so, something about each annual unit becoming an ever smaller segment of our accumulated lifespan. Numerators, denominators, whatever…all I know is that the passage of time means different things to different people, depending on their circumstance.

A recent case illustrates what I’m talking about. A young woman was injured in an auto accident due to someone else’s negligence. She was required to undergo surgical repair of her injuries and will need additional surgery to remove the internal fixation devices used to support the repair. She settled her case for the tortfeasor policy limit, but circumstances caused her to sign a document which gave her treating physicians and hospital first dibs on her recovery. After deducting the cost to satisfy this medical provider lien and her attorney’s fees, there is not enough remaining to cover the cost of this final surgical procedure.

How then do we guarantee this young woman the necessary funds to pay for future surgery when it becomes necessary? Given this challenge, I needed to know some things: when would she need the surgery and how much did she expect it to cost? It turns out the “when” question is hard to pin down because it depends on how well her body responds to the repairs and how fast it heals. In short, there IS no specific time she can say she’ll need the funds. The expected cost however, is thought to be in the area of $50,000.

That number is causing our claimant deep stress and anxiety because the net proceeds of her settlement is less than $ 40,000 and she is not at all confident that she will be able to raise the additional $10,000 on her own. I told her not to worry; as long as we have some time to work, with I would be able to help her.

I put together a simple settlement plan that guarantees her a tax-free payment of $50,000 in ten years on (October 1st 2022) for a cost of $38,853. I explained that this plan actually harnesses the time to which she is already committed for healing her injuries allowing her settlement to grow into the dollar amount she will need when she is ready to have the final surgery.

The combined power of the time value of money and the IRC Section 104 income tax exclusion guarantees a simple yet elegant solution to her financial problem.

This particular case was not dramatic in dollar terms, nor was it particularly complex, but it was extremely important to this young woman to know that she would be able to pay for her future surgery. And that is an “ending” all parties could be happy with.

Structured settlements solve real problems of deep concern to injured people. If you haven’t employed one lately, it’s an excellent time to propose one. Call Frank C. Kilcoyne CSSC at 800-544-5533, I am here to help.