Long-Term Care with Annuities
Your Savings Can Fund Long-Term Care — and Still Belong to Your Family.
The Long-Term Care Problem — and Why Most Retirees Are Not Prepared
Nearly 70 percent of retirees over age 60 will need some form of assisted living, home health, or nursing care. Memory care in the Tri-Cities region averages $7,000–$9,000 per month. Medicare does not cover custodial care. The WA Cares Fund provides a $36,500 lifetime maximum — approximately four to five months of care — leaving the majority of a long care event unfunded for most retirees.
Without a plan, long-term care costs come directly out of retirement savings. For many families, a multi-year care event is the single largest unplanned expense in retirement — and the one most likely to deplete a nest egg built over decades.
Mark Rogers, CLTC, LUTCF — the Certified in Long-Term Care designation is specific to long-term care planning, and it is the credential that matters most for this conversation. Mark has spent more than 20 years helping eastern Washington families build long-term care funding strategies that protect savings without requiring ongoing premium payments. If you want to go deeper before you schedule, the Talking Turning 65 podcast covers long-term care costs, funding strategies, and annuity-based solutions in plain English — free, any time.
How Asset-Based Long-Term Care Annuities Work
Reposition Savings — Not Ongoing Premiums
Traditional long-term care insurance requires monthly or annual premium payments for years. If care is never needed, those premiums are gone. An asset-based long-term care annuity works differently: you reposition a portion of savings you already have — typically a lump sum — into a specially structured annuity that multiplies the available dollars for qualified care costs.
If care is never needed, your money continues to grow tax-deferred and the remaining value passes to your heirs as a death benefit. You do not lose what you do not use. The funds remain an asset, not a sunk cost.
Tax-Free Withdrawals for Qualified Care
Under IRS Code 7702B, withdrawals from a qualifying long-term care annuity for covered care expenses are tax-free. That means when care costs are drawn from the annuity, you keep more of what you saved — the withdrawal is not added to taxable income. This is one of the most significant advantages of an asset-based strategy over paying for care directly from a taxable retirement account.
Multiplied Coverage From Savings You Already Have
An asset-based long-term care annuity can multiply the available dollars for care — often significantly beyond the original contribution — for a defined benefit period. A single lump sum can provide multiple years of covered care, with the benefit amount determined at contract issue and disclosed in writing before signing.
The right contract depends on your health, your age, the savings you are repositioning, and how many years of coverage you want to build. A review of your full picture determines what a reasonable strategy looks like for your specific situation.
What the WA Cares Fund Covers — and What It Leaves Behind
The WA Cares Fund provides a $36,500 lifetime maximum for qualifying care costs — approximately four to five months of care at current Tri-Cities regional rates. For retirees who need extended care, the fund covers the beginning of the need and nothing more. An asset-based long-term care annuity is designed to fund the years that follow.
Why Eastern Washington Families Trust Us With This Planning
"I live on a small farm in eastern Washington. My clients are my neighbors. That is not a marketing line — it is just the truth." — Mark Rogers, CLTC, LUTCF
— Mark Rogers, CLTC, LUTCF
Long-term care planning is one of the most personal conversations in retirement. It is not just about money — it is about not becoming a burden to the people you love, maintaining dignity if your health changes, and making sure a care event does not undo everything your family spent a lifetime building.
Mark Rogers holds the Certified in Long-Term Care (CLTC) designation — a credential specific to the emotional, financial, and physical dimensions of long-term care planning. He has sat across from eastern Washington families navigating this conversation for more than 20 years. He knows the questions people are afraid to ask, and he answers them plainly.
If your current situation already addresses long-term care adequately, he will tell you that too.
Learn more about our team and how we work.
Long-Term Care with Annuities — Questions Answered Directly
What is an asset-based long-term care annuity?
An asset-based long-term care annuity is a specially structured annuity that repositions a lump sum of existing savings into a strategy that provides multiplied coverage for qualified long-term care costs. Unlike traditional long-term care insurance, there are no ongoing premiums — the contribution is a one-time repositioning of savings. If care is never needed, the remaining value continues to grow tax-deferred and passes to heirs as a death benefit.
Are long-term care withdrawals from an annuity tax-free?
Under IRS Code 7702B, withdrawals from a qualifying long-term care annuity used for covered care costs are tax-free. This is a significant advantage over paying for care from a traditional taxable retirement account, where withdrawals are added to taxable income. A qualifying contract must meet specific IRS requirements — the terms are disclosed in writing before any contract is signed.
What does Medicare cover for long-term care?
Medicare does not cover custodial long-term care — the ongoing, day-to-day care assistance that most retirees need when a health event makes independent living difficult. Medicare covers short-term skilled nursing facility stays under specific conditions and limited home health visits. For extended assisted living, memory care, or home health care, Medicare pays nothing. Planning for long-term care means planning for the costs Medicare does not cover.
What is the WA Cares Fund and how does it affect my planning?
The WA Cares Fund is a Washington state long-term care benefit funded through a payroll assessment. It provides a lifetime maximum benefit of $36,500 — approximately four to five months of care at current regional rates in the Tri-Cities. For retirees who need extended care, the fund covers the beginning of the need. An asset-based long-term care annuity is designed to fund the years that follow.
What if I never need long-term care — what happens to the money?
With an asset-based long-term care annuity, if care is never needed, the remaining contract value continues to grow tax-deferred and is paid as a death benefit to named beneficiaries. Unlike traditional long-term care insurance premiums, which are gone if care is never used, an asset-based strategy keeps the funds as an asset on your balance sheet throughout your lifetime.
Serving Long-Term Care Clients Across the Tri-Cities and Eastern Washington
My Safe Money Matters provides long-term care planning and annuity guidance to residents of Kennewick, Richland, Pasco, Prosser, and West Richland, and communities throughout Benton, Franklin, and Yakima counties. In-person and virtual consultations are both available.
Protect Your Savings From the Cost of Care — Before You Need It.
A free 20-minute consultation with Mark Rogers gives you an honest look at your long-term care exposure, what the WA Cares Fund covers, and whether an asset-based annuity strategy makes sense for your situation. No obligation. No pitch in the first call.