This calculator provides both the nominal annual rate and effective discount rate of a structured settlement funding transaction. Please feel free to place this on your blog or website.
What does this calculator do? This calculator calculates both the effective discount rate and the nominal annual discount rate of a structured settlement funding transaction. This calculator was created to help consumers, judges, brokers, and other financial professionals calculate the discount rate of a settlement factoring transaction understanding that in most cases a discount rate above 14% is a ripoff (depending on the payment stream).
What is a discount rate? The discount rate is metric to determine the present value of a future value of payments. Structured settlement funding transactions are priced using this rate. The time value of money is a metric used to calculate the discount rate of future money.
How do I use this calculator? First, enter a present value or cash offer a company has provided for the structured settlement. After entering the present value of the structured settlement/annuity, enter the payment stream of the structured settlement including the next payment date, number of payments, amount of payment, and click calculate. You will now be given an effective rate and a nominal annual discount rate.
How do I place this on my web site? To place this calculator on your web site, simply copy and paste the code below into the appropriate spot on your blog or web site. Please do not remove any code from the textarea below, otherwise the calculator will not function properly.