George Kamel Says Skip the $250,000 Annuity. His Alternative Could Pay $676,000

On the November 4 episode of The Ramsey Show, co-host George Kamel told a couple to pass on an annuity they were considering to pay for long-term care. George Kamel offered his own plan for the 250 grand: “If you invested 250 grand in the stock market for 10 years at a 10% average return, you’d have $676,000, which would cover both of you in a long-term care situation and more. That’s personally what I would do.”

The advice fits a rule Kamel laid down earlier in the same episode: “Never mix insurance and investing. It’s always a scam.” We checked his numbers.

Kamel’s Math Comes Out a Bit High

George Kamel assumed a 10% average annual return over 10 years. At exactly that rate, compounded once a year, $250,000 grows to about $648,436. That is less than the $676,000 George Kamel quoted. It’s still a big number, but his figure is generous.

Recent market history supports his return assumption. The SPDR S&P 500 ETF Trust (NYSEARCA:SPY) gained 267.69% over the same 10-year period Kamel used, ending November 4, 2026. That works out to roughly 13.9% a year, before considering dividends. Over the past five years, the fund rose 63.66%, or about 10.4% a year. Kamel’s 10% return is a reasonable long-run average. Any single decade can come in well above or well below it.

A Bad Market Year Can Break the Plan

An average return doesn’t help much if you need the money in a bad year. The fund was down 3.92% in trading on November 5. Say a 25% bear market hits right when one partner needs care. That would reduce the $648,436 to about $486,327. The danger is even greater if care is needed in year two or three, when the account is smaller and selling shares at a loss locks in the damage. This is what’s known as sequence-of-returns risk: losses early in retirement, or right when you need cash, do more harm than the same losses later (we put together a free guide on defending those first few years against exactly this problem, here).

The chance of needing care is high. Consumer advocate Clark Howard has put it at maybe a 2 in 3 chance that someone will need help with daily activities. Medicare covers little of it. The 2026 CMS fact sheet lists skilled nursing coinsurance at $217 a day, and Medicare does not pay for long-term custodial care.

What an Annuity Gets Right, and What It Costs

An annuity’s main selling point is a paycheck that keeps coming no matter what the market does or how long you live. That matters because Social Security alone pays an average couple about $3,208 a month after the 2026 cost-of-living increase. Some annuities also include a long-term care rider. Howard has noted that with this setup, “you have the benefit of using the money from the annuity while you live, but if needed, it can be used for long-term care.”

Annuities carry costs. Surrender charges can run 7% on withdrawals in the first year and decrease each year after, tying up money a couple may need quickly. Fees and limited inflation protection add drag. Stand-alone long-term care insurance has its own problems. Howard warns that premiums “are not guaranteed” and that benefits are usually limited to three or five years.

So, Is Kamel Right?

For the most part, yes, with a condition attached. Investing the $250,000 in a low-cost index fund probably leaves a healthy couple with more money and more flexibility, as long as they don’t expect to need care for a decade and have other savings to fall back on in a downturn. The invested money stays theirs, and whatever they don’t use goes to their heirs.

The annuity makes more sense for older couples, people with health problems that make care likely to come soon, and anyone who would sell in a panic during a crash. For them, a guaranteed payout may justify the fees. Before deciding, check two things: when care is likely to be needed, and how big a market drop the plan could survive in that year.

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