Factors That Determine Loss of Future Earnings in Accident Cases

An accident can affect your employment and income for many years, even for the rest of your life. Thus, the liable party should compensate you not only for present losses but also for your loss of future earnings. Below are some of the factors the court will consider when they determine your loss of future earnings.

Your age is a critical factor here for two main reasons. First, your age determines how long you have to work before your retirement. The longer you have to work, the higher your lost future earnings are likely to be.

For example, the federal retirement age for firefighters is 57 years (for those employed on or after July 6, 2008). Thus a 23-year-old firefighter has more work years ahead of them than a 50-year-old firefighter.

Secondly, many people continue to work (maybe in different occupations) after their retirement. In this case, the government considers the current life expectancy in the country.

Occupation is a factor because experts can calculate your projected earnings in the future. For example, most professions realize an increase in earnings with time. However, the increase in pay differs by profession as some professions witness more growth than others. Thus, the court will consider how much income growth you could have realized without your injury.

Education is a huge indicator of future earnings. For example, a young adult who has just earned their doctorate is more likely to experience a growth in income than a young adult who has dropped out of high school. The type of education also matters; for example, courses with traditional high incomes may lead to high computations for loss of future earnings.

Loss of future earnings is the difference between your current earnings and what you might have earned without the accident. The more you currently earn, the lower your loss of future earnings. Thus, for two lawyers who currently earn $100,000 and $65,000 per year, the loss of future earnings is likely to be higher for the second lawyer (if other factors remain constant).

The court will consider whether you have progressed in your job and whether you have experienced demotions or breaks between jobs in the past. Your damages may be high if you have a solid work history and had experienced a steady career growth before your injury. However, breaks in employment and problems at work may hurt your claim.

The severity and permanency of your injuries determine how likely you are to work in the future and how much you might earn. Your lost future earnings increase with the increase in the severity of your earnings. For example, an accident victim diagnosed with full paralysis is likely to experience a higher loss of future earnings than an accident victim with a temporary disability.

Lastly, the authorities must also consider the labor market when it computes your future damages. Even if you are well educated and had a good job before the accident, your loss of future earnings might not be much if the labor market is weak. Here, the economy, job growth, current openings, and projected growth in your industry all play an important role.

The calculation of lost future earnings is not a precise science. As such, a small mistake can cost you thousands or even millions of dollars. Frank W. Thompson Attorney At Law Erwin & Thompson LLP can help you avoid such mistakes and maximize your damages. Contact us with your personal injury case so that we can help you maximize all aspects of your damages.