Today’s Smart Money Question:
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Here Are Just A Handful Of Things You’ll Learn:
On today’s episode we’re talking about a couple conversations we’ve had with clients in Seattle, Wash. and some recent changes that have been put in place. In 2019, the state approved a new payroll tax that is 100% paid by the employee, the first of its kind in the entire country.
It doesn’t sound like a lot. It’s only 0.58% of your total compensation, including base salary, commissions, bonuses and restricted stock options. It does not include rental income, interest income, pension income or Social Security income.
They’re calling it the Washington Cares Fund. It will pay for long-term care expenses for residents of the state of Washington.
So, what’s the benefit of this program? They’ll give you $100 a day, up to a max of $36,500 only to be used in the state of Washington. But the average cost in the state is almost $11,000 per month if you need that care.
You can opt out if you get your own private long-term care coverage. So, what is the state of Washington trying to tell its residents? They are telling you to go get your own coverage so the state doesn’t have to deal with it.
This is an experiment, but other states are likely looking at this. Long-term care is a topic that most people don’t like talking about, but it’s important to pay attention to what’s happening.
If you want to learn more, check out these two resources:
Average cost in WA. $9-10K/month per seniorliving.org
How Washington Currently Pays for Medicaid
Listen to the full episode or use the timestamps below to jump to a specific section.
2:28 – New Washington tax
5:24 – What’s the benefit?
7:16 – Opt out
8:36 – What are they telling you?
11:48 – The feds
15:40 – Mailbag: Worried about kids
“I think it’s interesting that the state of Washington is doing this.”
-Matt Hausman
Additional Podcast Episodes:
- What To Know About President Biden’s Tax Proposals
- Tough Questions About Family Finances
- Leaving 401K to My Child
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The host: Matt Hausman – Contact – Resources – Call: 610-719-3003
