You've probably noticed a few emails in your inbox letting you know that you may be eligible for a payout from various class action lawsuits. These lawsuits generally entitle a large group of victims to a fair share of the settlement funds. Some of the most recent lawsuits include Blue Cross Blue Shield, UnitedHealthcare, Cigna, Google Play, Hyundai & Kia, and Boston Children's Health Physicians. More coming down the pipeline are lawsuits against Roblox, Ticketmaster & Live Nation, Amazon Ring Cameras, and more.

So, odds are you may be in the running to receive a portion of those giant settlement sums. If so, a company that has been delegated to distribute the funds will contact you with details regarding how you can claim them. They will have a simple yet important question that you'll need answer. How would you like to receive your payment? Sounds simple enough, but choosing wrong could cause you a lot of headaches down the road. In this article will go over which payment methods may be best for you and your situation.

Payment Methods to Choose From

You'll be given a handful of choices to choose from when deciding how your payout will be sent to you. It's important to think this over and take into account how you plan to use the money before choosing. These methods will most likely include...

  • Direct Deposit
  • Physical Check
  • Prepaid Credit/Debit Card

The Worst Payment Method: Prepaid Credit or Debit Card

The absolute worst payment method to choose is requesting a prepaid credit or debit card. The biggest issue is that you most likely won't be able to transfer the balance to your bank account. On top of that, these cards are generally not accepted by Venmo, Zelle, or PayPal. So you're stuck using the card if you want to spend that money.

Since the payout per person for these settlements is pretty low (a couple bucks to tens of dollars) using any amount of the balance gets tricky and using the full amount is near impossible. Sites like Amazon don't allow you to split your bill between cards, so you can buy something super inexpensive but you'll always have a remaining balance on that card.

Now, the companies that are in charge of distribution are very much aware that you'll never use the entire balance of your card. In fact, they're counting on it. If you read the legal fine print of the card when claiming it you may notice a block of text stating that the distribution company will hold on to your remaining balance for a period of time, something like 18 months. After that they will charge your card a monthly service fee which could be around $0.75 or so. This means that the remaining balances on millions of cards go straight to the distribution company. Which might not sound like much, but it can potentially add up to hundreds of thousands of dollars. Sounds kinda scammy, right?

The OK Payment Method: Direct Deposit

You might be asking yourself, why would direct deposit just be ok? Well, on the plus side it's a very convenient method of payment as the money is sent directly into your bank account. Of course, this means you need to give an unknown and possibly untrusted company your bank account information. In this day and age of information piracy and questionable data collection practices we'd say it's a bit sketchy to just hand that kind of sensitive info over to just anyone. To be fair, it's very possible that the money will transfer over to your account without a problem. But, who's to say someone along the way isn't storing that info and selling it to whoever they please? In our opinion it's best to be safe than sorry.

The Best Payment Method: Physical Check

Requesting a physical check to be sent to a postal address of your choosing is the absolute best option to receive your money. Not only does it keep your personal information safe, it allows you the freedom to put that cash wherever you'd like. Sure you may need to wait a couple days for the check to arrive, but there's no hassling with unspent balances and no sitting up at night wondering who has your bank info. All in all, getting sent a check in the mail is our overall payment method pick.

Which Method Should You Choose?

As we touched upon earlier, it's all up to you and how you plan on using the money. If you know for sure you can transfer the balance from a card to your account then the prepaid card might make sense. If you don't personally care if your banking information is shared with anyone and you need the funds quickly, then direct deposit is for you. If you can wait a couple days and your privacy is important, go with a physical check sent to your address. No matter what you choose we hope you're able to spend that money on something fun! It's not often that we get something back from those giant companies, so enjoy it if you can.