What Happens After I Receive My Compensation in Brisbane?

Receiving compensation after an injury or loss can bring relief and help you move forward. But once the funds are in your hands, you may wonder what to expect next and how best to manage this compensation.

At Morgan Clifford Lawyers in Brisbane we have helped countless clients navigate the post-compensation process, ensuring they understand their options and any remaining obligations.

Here’s an in-depth look at what happens after you receive your compensation, along with steps to protect your funds and support your recovery.

1. Understand Your Payment Structure

Compensation can be paid as a lump sum or through structured payments.

Here’s how they differ:

• Lump Sum Payment: If your compensation was awarded as a lump sum, you receive the entire payment upfront. This approach is common for personal injury cases, accident compensation, or negligence cases.
• Structured Settlement: Some cases, particularly large or complex claims, might be paid through structured payments over time. Structured settlements provide periodic payments, helping recipients budget over the long term. However, it’s less flexible than a lump sum, as you receive funds at intervals.

Morgan Clifford Lawyers can help you understand how your payment is structured.

2. Check If You Owe Any Fees or Deductions

In most compensation cases, certain deductions might be taken from your payment before you receive it. These may include:

• Legal Fees: In some cases, legal fees are deducted directly from your compensation. Your lawyer should have clarified this arrangement beforehand. Morgan Clifford Lawyers, for example, outlines fee structures transparently to ensure clients aren’t caught off-guard.
• Medical Expenses or Medicare Refunds: Compensation payments for medical injuries sometimes include deductions for Medicare or other health insurance reimbursements. You may need to settle any outstanding medical expenses before you have full access to your funds.

After these deductions, the remaining amount is yours to use as needed.

However, if you receive the total amount directly, make sure to settle any outstanding obligations promptly to avoid penalties or interest.

3. Consider Setting Up a Budget or Financial Plan

Compensation money can feel substantial, but without careful planning, it’s easy to spend quickly. A well-thought-out budget can help you manage your funds effectively, particularly if you are covering medical bills, rehabilitation costs, or other long-term expenses.

Here are some budgeting tips post-compensation:

• Identify Immediate Needs: List any urgent expenses, such as outstanding bills, medical treatments, or debt. Cover these first to reduce financial stress.
• Allocate for Future Expenses: If you require ongoing care, set aside funds for future treatments, medications, or therapy. This is particularly important if your compensation covers long-term medical care.
• Consider Professional Guidance: Financial advisors can help you create a plan to protect your compensation. For example, they can assist with investment advice or suggest ways to grow your funds over time.

Morgan Clifford Lawyers can connect you with financial professionals in Brisbane to help you make informed decisions.

4. Know Your Tax Obligations

Consult a tax professional to clarify any obligations, especially if your compensation involves structured payments or investment earnings. Staying informed can help you retain more of your compensation in the long term.

5. Manage Any Ongoing Financial Commitments

In some cases, people receiving compensation payments have ongoing obligations, such as paying debts, child support, or spousal support. Consider how your compensation may impact these obligations:

• Debt Repayment: Many people use compensation funds to pay off high-interest debts, which can reduce monthly expenses and improve financial stability.
• Child or Spousal Support: If you are legally required to pay support, your compensation could affect these arrangements. Seek legal advice if needed to understand your rights and responsibilities in these situations.

6. Stay Informed About Potential Impact on Government Benefits

Receiving a large sum of money can sometimes impact eligibility for certain government benefits or Centrelink payments. It’s important to understand how your compensation might affect benefits, including:

• Income Testing: If your compensation is invested, the resulting income may affect Centrelink payments based on income tests.
• Asset Testing: Centrelink may also assess your total assets, including any compensation you receive, to determine eligibility.

To avoid disruptions to government benefits, consult with a Centrelink advisor or legal professional about your specific situation.

7. Seek Support for Physical and Emotional Recovery

The process of receiving compensation is often long and challenging, and reaching a settlement can bring mixed feelings.

Beyond financial considerations, it’s vital to prioritise your physical and mental well-being as you move forward.

• Continue with Rehabilitation: If your compensation included funds for ongoing rehabilitation, ensure you follow through with any recommended therapies or treatments. Long-term recovery may depend on consistent care.
• Mental Health Support: Compensation can provide closure, but it doesn’t erase the trauma. Therapy or counselling can be a valuable step in processing your experience and adjusting to post-injury life.

Morgan Clifford Lawyers supports clients through their recovery journey and can connect you with resources in Brisbane for mental and physical health services.

What happens after I receive my compensation?

Receiving compensation is a significant milestone, but it also requires thoughtful planning to make the most of your settlement.

By understanding your payment structure, budgeting carefully, staying informed about taxes and benefits, and addressing any ongoing financial obligations, you can manage your compensation effectively and secure a stable financial future.

For more information or to book a consultation, visit morganclifford.com.au.