annuity payments that come as part of a workers compensation settlement or a lottery win can be something of a mixed blessing. On the one hand, an annual payment is as good as money in the bank. No matter what else happens that money is going to appear in a bank account like clockwork. But that same regularity can also be constraining.

Many times, the recipients of these settlements run into financial emergencies and simply cant wait for their next payment. Families in this situation frequently turn to a financial firm that will buy structured settlement payments in exchange for a lump sum. But is selling out years of financial security for cash today really a good idea?

The answer to that question depends greatly on the financial discipline of the parties involved. Exchanging cash for structured settlement payments means that the guaranteed payments at a discounted price. When the lump sum is gone, there wont be another payment to replenish the pot.

Some financial advisers advise clients in this situation to go ahead and take out a bank loan if they need quick cash. Anyone with a guaranteed source of income is likely to be a good candidate for loans anyways.

Anyone considering this move should act slowly and really consider all their options before moving forward.