A lump sum settlement is defined as a large payment of a fixed amount of money offered to another spouse following a divorce for all future financial obligations, including alimony and division of property rights. The lump sum is a one-time payment, therefore, any future events that may limit alimony liability, for example, will not result in the return of funds. Additionally, if a spouse dies before payment is made, the estate can make claims on the lump sum as well. In theory, the spouse paying a lump sum will seek to save money in long run by offering a large amount of money initially. The benefits of this strategy depend entirely on case specific factors.