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Whether you read The Civil Justice Advocate as a member of the legal industry or you’re in another field, you’ve probably noticed that I often talk about settlement. And while my trial lawyer colleagues might use this newsletter to keep the pulse on the latest planning tools, others might be teetering on: Do I really need to know about this?

The truth is everyone should have a basic understanding of settlement planning. Having this knowledge in your back pocket could come in handy someday – for you or someone you know.

But what does a settlement planner do? Can’t plaintiffs just take their money after their cases end?

They can. However, accepting a large sum of money can sometimes offset financial aspects of a person’s life in ways they might not realize until it’s too late. For example, there’s a good chance that an injured plaintiff receives some sort of government disability benefits, such as Medicaid or SSI. If so, that person can’t cross a certain threshold of assets and income – which is surprisingly low – and money from a settlement or jury verdict can put them way over the edge. Settlement planners can establish certain accounts and trusts that allow plaintiffs to receive compensation from their injuries while keeping their much-needed government benefits.

But even for those who do not receive help from government programs, settlement money that’s meant to last a lifetime could be exhausted quickly without the right help. Think about it: how many people have enough financial and investment knowledge to spread hundreds of thousands, or even millions of dollars, over a lifetime?

A settlement planner takes a holistic look at each plaintiff’s unique needs and goals and develop a plan that makes the most sense for his or her life and family. This expert has specialized knowledge beyond financial planning – specifically:

  • An understanding of the various investment strategies, tax options, trusts, and tools available to people who are about to receive a civil settlement,
  • Experience with taking current and future medical needs into consideration, and
  • An awareness of the care and compassion needed when working with someone who has experienced a traumatic, life-changing event.

And settlement planning isn’t just for plaintiffs; we also help trial lawyers. Settlement planning can be implemented with an attorney’s incoming fees to prepare both for tax time and their long-term personal and professional wealth strategy. Or, in the instance of mass torts or class actions, settlement planning tools like a qualified settlement fund can ensure a lawyer’s multiple plaintiffs are being properly taken care of at the time of disbursement.

Ideally, settlement planning does not begin during settlement talks. In fact, there is value in bringing an expert on board as soon as possible. Meeting early allows time to build a relationship and discuss all factors that may influence the smartest way for the plaintiff to receive his or her settlement money. There is also time to anticipate any potential obstacles and find proactive solutions to help ensure the end of the lawsuit goes as smoothly as possible.

That’s settlement planning in a nutshell. As attorneys work hard to get the best result for their clients, we work as an extension of that effort by ensuring settlement is most beneficial, both today and in the future. If you have any questions about settlement planning, feel free to message me on LinkedIn or give Milestone a call.

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