How to Fairly Calculate Lost Earnings
If an individual is hurt in an accident caused by another party’s negligence, he or she may be entitled to lost future earnings. However, it can be hard to determine just how much a person may earn over the course of several years or decades. Therefore, several variables are used to determine an estimate that is appropriate given the facts in a given case.
Age and Education Level Come into Play
As a general rule, someone who is younger will have more years to earn an income compared to someone who is older. Individuals who have higher levels of education will generally earn more than those who only have a high school degree or who never graduated from high school. In some cases, a person’s skills may be considered in lieu of a formal education. For instance, a person who made money baking or woodworking may make good money even if he or she doesn’t have a high school or college degree.
Would a Worker Be Entitled to a Future Raise?
As workers progress in their career, they may be entitled to raises in pay. Changes to minimum wage or other laws may also entitle workers to higher hourly pay even if their skill set doesn’t change. Increases in the minimum wage and future raises are generally factored into a lost future earnings award in a personal injury case.
Don’t Forget About Inflation
Inflation refers to the value of goods increasing over time. As the price of goods goes up, the buying power of the dollar decreases. To account for this, a lost earning award may ultimately be less than the exact amount that an injured person may earn. Las Vegas injury attorneys may be able to further explain this concept.