Hello, seeking advice on what I should do with my NCAA settlement. I recently just got an offer to cash out on my claim ($106K) for a little under $50K.
To provide a financial landscape. I am a law enforcement officer in Indiana and make aprox $66K a year. My wife is a SAHM with our 2yo, so were a solo income family. Currently living in an apartment that is too small for our family and really wanting to get into a house within the next 1-2 years. But as we've begun that process, we've found that if we can't get rid of the majority of my debt (Student loans) we wont qualify for the amount on a house that we would want. Also, the monthly payment with my private student loan + a car payment would make taking on a higher mortgage very difficult.
Also, an honest concern of mine for my family, I work in a dangerous career field and the payment plan is over a 10 year period. What if something were to happen to me and then what? My family wouldn't get the money that I am owed?
Seeking some advice from those that know taxes cause im afraid of taking this deal and having a tax bill next year that would make this whole thing worthless. Any advice on what to do?
NCAA Settlement Buyout – What should I do??
byu/LingonberryTrue3386 inpersonalfinance
Posted by LingonberryTrue3386
3 Comments
>What if something were to happen to me and then what? My family wouldn’t get the money that I am owed?
Any payments should go to your estate, which would go to your family.
If you’re being offered less than $50k for what is essentially a 10 year annuity, they’re using a ~11% discount rate, which is pretty hefty. I.e., you’d be giving up a decent amount of money to get cash now
How much debt do you have?
Less dangerous than a taxi driver or farmer. If you’re that worried get life insurance. I’ll offer you $51,000
Talk to a tax attorney and get term life insurance.