Earlier this year, Article 82 of the New York Mental Hygiene Law (Article 82) became law, allowing for supported decision-making in New York. This new law gives intellectually and developmentally disabled individuals new tools to help them live productive and successful lives.

Prior to the passage of Article 82, parents with children who had intellectual or developmental disabilities were mainly limited to seeking guardianship of their child under Article 17-A of the Surrogates Court Procedure Act (Article 17-A). Article 17-A was passed in 1966, and more recently many disability advocates have pressed for alternatives to such guardianships.

Guardianships under Article 17-A 

Disability advocates have argued that the Article 17-A guardianships are too sweeping in nature, giving almost total control to the guardian over the disabled person’s financial and medical decision making. Contrasts were often made when comparing the broad powers granted under SCPA Article 17-A and the other New York guardianship statute – New York Mental Hygiene Law Article 81 (Article 81).

Article 81 guardianships are usually put in place for adults and are often used when a family member ages and begins to lose some of their functional capabilities. Under Article 81, however, the person seeking to become guardian (often a spouse or child of the allegedly incapacitated person) must prove that the guardianship is the least restrictive alternative, and the guardianship must be tailored to address the particular needs of the individual based on their functional limitations. Article 81 also mandates that the allegedly incapacitated person be represented by an attorney, if they request one.

No such limitations and protections are present in the Article17-A process, which has been a source of concern by not only disability advocates, but also disabled persons themselves and their loved ones. Article 17-A guardianships are generally approved by the court based on the medical testimony of two doctors or a doctor and a psychologist. Over the course of time, alternatives to Article 17-A guardianships have been developed, and one of the more promising is the supported decision-making process.

What is supported decision-making?

In supported decision-making, the disabled person is referred to as the “decision-maker” and they are assisted by “supporters” who help them make decisions regarding their financial affairs and health care. The decisions are made pursuant to a “supported decision-making agreement” (SDMA), which details how the disabled person will work with their supporters to come to decisions regarding their affairs.

What do facilitators do in the process?

A facilitator is a person or entity authorized by the New York Office for People with Developmental Disabilities (OPWDD) to work with and educate a decision-maker and their supporters regarding the supported decision-making process and SDMAs. Within the next year, OPWDD is expected to come out with regulations that will describe more fully the role and responsibilities of facilitators. Generally speaking, the facilitation process should be expected to take several meetings and perhaps a number of months to come to fruition.

What is a supported decision-making agreement?

A SDMA is an agreement signed by the decision-maker and their supporters which details what type of decisions the decision maker will be assisted with and what the role of the supporters will be in that process. If a facilitator was involved in the agreement, they will also sign the SDMA and they will confirm that the agreement was made in accordance with a recognized facilitation and/or education process. The SDMA must be witnessed by two people or notarized.

What effect does the SDMA have?

If the SDMA is properly drafted and signed by a facilitator, then decisions made pursuant to that agreement by the decision-maker will have the force of law and can be enforced by a court of competent jurisdiction. For example, if a disabled person signs a lease with a landlord, pursuant to such a SDMA, that lease would be a legally enforceable agreement. 

What does the future hold for supported decision-making?

Disability advocates hope that supported decision-making will be considered as a viable alternative to Article 17-A guardianships. There has been significant discussion about modifications to Article 17-A to make these guardianships less sweeping in scope. We will likely see changes in the future to Article 17-A, which will allow these guardianships to be more tailored to the needs of the individual.

There will likely always be a need for Article 17-A guardianships, especially for individuals who have more severe disabilities. For disabled persons with less severe disabilities, however, supported decision-making may provide the help they need, without the loss of control and autonomy that an Article 17-A guardianship can bring.

Supported decision-making cannot be fully utilized to its potential in New York until the regulations in support of Article 82 are promulgated by OPWDD. But in the interim, disabled persons and their families can explore how the process may work for them by discussing options with trusted advisors experienced in this area. If you would like more information on supported decision-making, you can go to the Supported Decision-Making New York website maintained by Hunter College – sdmny.hunter.cuny.edu. 

Matthew J. Dorsey, Esq. is a Senior Partner with O’Connell and Aronowitz, 1 Court Street, Saratoga Springs. Over his twenty-five years of practice, he has focused on the areas of elder law, estate planning, and estate administration. Mr. Dorsey can be reached at 518-584-5205, mdorsey@oalaw.com and www.oalaw.com

I usually cover the topic of year-end planning in my December column, but with rampant inflation, economic uncertainty, geopolitical strife with no end in sight and, most recently, a divisive election season, putting the year 2022 in the rearview can’t come soon enough for many of us. In preparation for closing out the year, let’s discuss some important steps you should consider.

The first order of business is to make sure you’ve made the Required Minimum Distribution (RMD) from your IRAs and other retirement plans for the year.. If you’re age 72 or older, or have certain inherited retirement accounts, you will need to make minimum distribution by year’s end. The penalty for non-compliance is 50% of the amount you should have distributed, so check and double-check that you’ve distributed the proper amount.

If, like many, you don’t need the RMD to make ends meet, and would prefer not to take any distribution at all, consider donating it to a charity of your choice. The IRS allows you to distribute funds directly from your IRA to a charity, and not pay taxes on the distribution, even if you aren’t eligible to itemize deductions on your federal taxes. This is called a Qualified Charitable Distribution (QCD), and it’s important to remember that funds must be cut directly in the name of the charity; you cannot act as an intermediary and qualify for a QCD. 

If you’re not subject to an RMD, but are charitably inclined, you can still utilize a QCD to benefit your charity of choice in a tax-favored way.

The next piece of financial housekeeping will be to begin to gather documents you’ll be needing just after the new year to prepare your taxes. Compile receipts for medical bills, tuition payments, child care and charitable contributions, among others.

While many of us will no longer be able to itemize deductions due to recent tax law changes, there are credits for things like child care and education expenses which you may still be eligible for. For those with large medical bills, mortgage interest, or who have been particularly philanthropic this year, you may still be able to itemize, so it is important to have those receipts handy.

When it comes to planning for your retirement, this is the perfect time to evaluate contribution levels to your retirement plans at work. If you have the ability, and you’re not yet contributing to the maximum levels allowed, consider topping these accounts off to take advantage of the possible tax deduction this year, as well as the ability to simply squirrel as much away for the future as possible. Even if you can’t contribute to the maximum, be sure to at least contribute enough to take advantage of any employer matching contributions. 

You may not be aware, but once you reach age 50, you are eligible for higher catch-up contribution levels than in prior years. So, if you’ve turned 50 this year, consider increasing your contributions. For 401(k) and 403(b) plans, you can contribute an additional $6,500 to a max of $27,000 from $20,500 for those under 50. For SIMPLE plans, you get to contribute an additional $3,000, up to a max of $17,500. 

In 2023, limits are increasing again. 401(k) and 403(b) limits increase to $22,500 (plus $7,500 catch-up) and $15,500 (plus $3,500 catch-up) for SIMPLEs. Take advantage of this opportunity to catch-up on contributions you may not have been able to make when you were younger. 

The end of the year is a good time to review your various forms of insurance, including your home and auto. Take note of various coverage limits and deductibles. If you can, consider a higher deductible in order to save on premium expenses. 

As home values have increased dramatically in recent years, ensure that your homeowners coverage amounts reflect the value of your home. You may also want to consider an umbrella policy, which provides additional personal liability coverage, in excess of your home and auto limits. 

An often-overlooked task is to review your beneficiary declarations each year. Families grow, as new members are added, and shrink with death and divorce, which means that beneficiary and Transfer-on-Death declarations can easily become outdated and no longer reflect your true wishes. 

Since these declarations are a matter of contract, they will overrule what your will may say. So, even if you’ve updated your will to exclude an ex-spouse, but you left them as beneficiary on your IRA, your new spouse won’t be able to inherit those assets, but the ex will, and it can’t be challenged in probate.

Your Certified Financial Planner® professional is well suited to help you mark most of these items off your list. Review your beneficiaries, gather tax documents, maximize funding of your various retirement plans, take required distributions, and review your insurance coverage with your advisor each year, to help ensure that your financial plan is well-tuned as you prepare to turn the page on 2022.

Stephen Kyne CFP® is a Partner at Sterling Manor Financial in Saratoga Springs, and Rhinebeck.Securities offered through Cadaret, Grant & Co., Inc. Member FINRA/SIPC. Advisory services offered through Sterling Manor Financial, LLC, or Cadaret Grant & Co., Inc, SEC registered investment advisors. Sterling Manor Financial and Cadaret, Grant are separate entities.

Though I’ve always hoped that the stories I share here are entertaining to you all, I’ve had a special hope that reading about the challenges and joys I’ve experienced as a mom are helpful to other moms — maybe helpful in showing you that you’re not alone, maybe helpful in sharing interesting lessons I learned the hard way, maybe helpful in giving you a laugh on a bad day. I’ve also thought that reading how our family life has changed over the years might help moms of little ones to see what’s ahead, and moms of older ones to “remember those days.”

Our life as a family feels like it’s changed rapidly and drastically in the past year or so with my oldest graduating high school and going away to college, which you might remember having read about (a few times!). Another thing that’s been a big change for us is that I started working at an outside-the-house job last year, which is what I want to write about today.

When I first started writing this column fourteen years ago and for many years after, I titled it “Saratoga SAHM,” with “SAHM” standing for “stay-at-home mom.” Several years ago I changed it to “Mothering Boys,” in part due to the fact that the “SAHM” part felt a little misleading — though I thought of myself as a stay-at-home mom, I meant it in the sense that I had no outside-the-house responsibilities that weren’t connected to the kids, and that almost any non-mom thing I spent time doing could be dropped in a second to tend to the kids. 

But I was starting to feel like “WAHM” was a more accurate acronym for me — “work-at-home mom” — since I had always spent quite a bit of time working on professional things: mostly writing (always writing! Many of which have been opportunities with the Saratoga TODAY family of publications, which I’ve loved), some editing/proofreading, and I even had a small ministry/business for several years doing baby name consultations for expectant parents. These things were all extremely flexible — things I could work on as I was able, in between diaper changes and nursing the baby, school drop-offs and pick-ups and baseball games and swimming lessons, making dinner and doing laundry, while sitting on the couch in the middle of the kids in clothes that had been spit up on. 

These were things I spent time doing in large part because I enjoyed them. Knowing that I had the capability of doing non-baby things kept me sane on bad days, and my babies also inspired me — this column, for example, has been such a gift to me, as it requires me, on a monthly basis, to record some aspect of our family life as it currently is, and going back to read through articles I wrote years ago never fails to make me laugh and cry and remember things I’d forgotten. But I also knew that keeping up with these professional pursuits helped me keep a foot in the door for the time when I would almost certainly be going back to work outside the home.

That time came last year — I found a job that was absolutely perfect for me and my family: it’s part-time and flexible, and it’s tailor-made for my professional background and experience. When I started, I was able to work three evenings a week, which worked out really well in terms of continuing to do school drop-offs and pick-ups and figure out after-school sports and other extra-curricular activities, as well as schedule all the kids’ doctor and dentist appointments, and keep them home without stress when they were sick (also: we were still deep in COVID). My job is down near Albany, so three evenings a week I piled the boys into the van and drove there, where my husband would meet me coming from work in Albany; we’d switch vehicles and he’d bring the boys home and take care of dinner and bedtime while I went to work. I was so pleased that I could continue doing all the mom things, and also be able to spend some time working and contributing to the family in a new way. The biggest downside was probably the fact that my then three-year-old would often fall asleep on the drive down at 5:30, which wasn’t great, since he’d then be up until 11:00, but then again, I’d get home at 10:15 so I’d be able to see him and put him to bed. Not too bad!

This year, I had the ability to switch to mostly daytime hours and to work a bit more, which I was excited about. It involved making a switch for my littlest guy’s schooling — his brothers never attended full-day school until Kindergarten, but I took advantage of the option for my youngest for his three-day-a-week program. Fortunately, he seems far readier for it than any of his brothers did at that age, and he has been loving it! 

One major challenge we’ve had this year, though, has been figuring out how to deal with our annual months-long Sick Season. Ohmygoodness. Trying to figure out how to properly care for sick kids who need to stay home from school when both parents work at in-person daytime jobs is a task!
Especially now, at the tail end of the pandemic, where even very mild symptoms are still being taken seriously and remote work isn’t as possible as it used to be. My husband and I have found ourselves trying to plan ahead as much as possible for different scenarios that involve little kids who can’t be left home alone for any amount of time (big kids are a bit more flexible this way) and symptoms that are mild enough that my mom could possibly be asked to provide some care or oversight (depending on the severity), while taking into account the demands and preferences of our jobs (which change depending on the day of the week). It’s not even November and we’ve already had several kids home sick for varying amounts of days. Ohmygoodness. If we come up with a good system, I may write about it in the future in case it’s helpful to any of you (and if any of you have good tips or strategies that you’ve found helpful in this regard, please feel free to email me!).

These bumps in the road remind of other such times of often hard and stressful adjustment that we’ve gone through — good things like adding a new baby into the family; sad things like caring for my dying mother-in-law; new things like my oldest going to college — all of it necessary, all of it requiring patience and perseverance, all of it part of the fabric of family life. Things always shake out and settle down again and the “new” becomes the “normal.” It’s sometimes hard to believe that when you’re going through it, but it’s true!

Kate and her husband have seven sons ages 18, 16, 14, 12, 10, 8, and 4. Email her at kmtowne23@gmail.com.

As an estate planning attorney, I often work with what has become known as “blended families.” Blended families often include married couples who have children from prior marriages or relationships. These families can present unique planning challenges when it comes to what should be left to the spouse, the children, and the stepchildren.

One challenge is that each spouse may have assets they have accumulated during their life prior to their current marriage. For example, they may have a lake house that was a favorite vacation spot for their children growing up. When they remarried later in life, however, they may now have stepchildren for whom that lake house holds no memories or connections.

Another challenge is that spouses in second marriages may or may not have strong relationships with their stepchildren. In some cases, they may have known the stepchildren since a young age and essentially raised them as their own. In other cases, the stepchildren may be adults with children of their own living across the country, and the stepparent may have little or no connection with them.

One thing to remember at the outset is that there is no legal requirement that you leave any of your estate to your children or stepchildren. The only person that can potentially elect against your Will and seek a legal share is your spouse. Generally speaking, your spouse has the right to inherit one-third of your estate. The “estate” on which this one-third is calculated includes not only assets in your name, but also so-called “testamentary substitutes,” such as assets held in trust.

This spousal elective share right prevents a spouse from totally disinheriting their spouse in their Will; in some cases, spouses in a second marriage do, however, give up this right if they sign a pre-nuptial agreement which releases it.

When it comes to children and stepchildren, you are free to give them whatever you want. If you make no provision for them in your Will, they will have no legal right to challenge it. With the exception that your children may have the ability to challenge it in limited circumstances where a challenge is generally available, i.e., in cases where you lacked capacity or were under undue influence. Such challenges are rare and often unsuccessful.

So – with all this said – how do you handle your estate planning if you have a blended family? One option is to treat the children and stepchildren the same. This is more often the case where the stepchildren have been with the stepparent from an early age. In those cases, the stepparent may think of those stepchildren as their own children.

This does not mean, however, that all children and stepchildren will be treated equally. As is unfortunately sometimes the case, the parent and stepparent may be estranged from one of the children and both the parent and stepparent may choose to leave that child nothing. That is their right, and as I mentioned before, there is little the child/stepchild can do to challenge that.

If there is a desire to treat the children and stepchildren differently, then there are several planning techniques to accomplish that. I will review two common examples in order to give you a sense of the options available.

First, you can make particular general bequests or specific bequests or devises (gifts of real property). A general bequest can be a gift of a particular amount of money, i.e. “I give $10,000 to my stepson Robert.” A specific bequest can be a gift of a particular asset, i.e. “I give my all my musical instruments to my stepdaughter Amy.” A specific devise can be a gift of a particular piece of real property, i.e. “I give my lake house at Caroga Lake to my sons, in equal shares.”

These types of gifts can be tailored to meet your particular needs, and as soon as they do not impact a surviving spouse’s elective share right, they can be set up however you desire. This customization of gifting may lead to uneven shares among children and stepchildren, but that is entirely permissible and may be appropriate for your circumstances.

Second, you can also consider the use of trusts. A common planning technique with second marriages, is to leave some amount of assets in trust for a surviving spouse. That trust will often require that income is payable to the surviving spouse and that principal may be payable to them for their health, maintenance, and support, in the discretion of the trustee. 

This allows the first spouse to make sure the second spouse is taken care of for the rest of their lifetime, but it also allows the first spouse to direct the distribution of the remaining trust assets after the second spouse later dies. In some cases, the remaining assets are distributed to the children of the first spouse. Such a trust can also direct that the second spouse have use of the marital home for a specific period of time or for the rest of their life, in order to prevent them from being displaced.

As you might imagine, each family is unique and what is appropriate for one family may be entirely wrong for another. In order to ensure you properly consider all options, it is advisable to consult an experienced estate planning attorney in your area. 

Matthew J. Dorsey, Esq. is a Senior Partner with O’Connell and Aronowitz, 1 Court Street, Saratoga Springs. Over his twenty-five years of practice, he has focused on the areas of elder law, estate planning, and estate administration. Mr. Dorsey can be reached at 518-584-5205, mdorsey@oalaw.com and www.oalaw.com

As far as Jerome Powell and the Fed seem to be concerned, we’re living in a world where up is down, down is up, good news is bad news, and bad news is great. It’s Bizzaro World!

The economy continues to be a difficult one for investors, as the Fed remains insistent upon increasing interest rates, at any cost. While many, including us, have been sounding the alarm about inflation since the stimulus spending spree of ’20 and ’21, the Fed only acknowledged it may be an issue earlier this year. 

As a result, the Fed has been compensating for being asleep at the wheel through a series of massive and rapid interest rate hikes in an attempt to bring inflation back to its target of 2%. Considering inflation has averaged 3.3% since 1914, a 2% target becomes an onerous demand to place on the economy, especially given all of the other headwinds. 

This ham-handed strategy has meant that the Fed is reading otherwise positive metrics as harbingers of doom. For example, the economy is currently at full employment, with new jobs in manufacturing, hospitality, and other sectors being created throughout the year. This otherwise good news is being interpreted by the fed as a sign that the economy is not slowing down.  

Estimates are that GDP for the third quarter will be positive by as much as 3% annualized. After two quarters of negative growth, one can only wonder at the Fed’s reaction to economic expansion. 

Most of the information that the Fed is using to make decisions about rate changes are lagging economic indicators. Consequently, the Fed won’t know it’s gone too far, until it’s gone too far. This compounds the difficulty around reining in inflation without sending the economy into a recession.

To make matters worse, the Fed needlessly unsettles markets by telegraphing today what it thinks it might do in the future, based on information from the past. It’s bizarre. 

Year to date, US indices are down as much as 32% (as of Oct 10).

So, where do we go from here?

1. We expect the Fed to continue raising interest rates, although any slowdown in the pace of these increases should be positive for the markets.

2. While rates have increased, it’s important to keep in mind that they are still not historically high.

3. The dollar continues to be very strong, which makes the cost of commodities, like grain and oil, which are priced in dollars on the world market, relatively less expensive to US consumers. Conversely this hurts our European friends.

4. Unemployment rates continue to be extremely low, signaling full employment. Recessions do not typically happen during these periods. We, and the Fed, will continue to monitor this metric.

5. We fully expect markets to continue to be volatile during the remainder of the year as economic and geopolitical factors remain at the forefront.

6. According to Reuters, fund companies are sitting on a mountain of cash. In fact, they are holding more cash than they’ve held in any year since 2001, as fund managers seek opportunities. We continue to watch this as an indication of what the “smart money” is doing.  

In light of economic and geopolitical headwinds, tactically overweighting cash and cash equivalents while you, too, seek opportunities, may make a lot of sense depending on your circumstances. As always, work closely with with your Certified Financial Planner® Professional to help ensure that your portfolio accurately reflects your individual needs, as well as the ever-changing market landscape. 

Stephen Kyne CFP® is a Partner at Sterling Manor Financial in Saratoga Springs, and Rhinebeck.Securities offered through Cadaret, Grant & Co., Inc. Member FINRA/SIPC. Advisory services offered through Sterling Manor Financial, LLC, or Cadaret Grant & Co., Inc, SEC registered investment advisors. Sterling Manor Financial and Cadaret, Grant are separate entities.

In the middle of a housing boom, especially during a period of high inflation, many people are tempted to explore the idea of investing in real estate. Real estate tends to carry a certain allure due to the concept of passive income, but talk to anyone who owns rental property, and they will tell you it is anything but passive. Like everything else, this decision is not entirely straightforward, and one should be aware of the costs and risks before jumping in. There are many avenues to access a real estate investment, so we will explore each individually.

This might be controversial, but I do not believe a home should be considered an investment in the traditional sense. Many people will disagree with this by saying they sold their house for more (sometimes much more) than they bought it. In fact, the long-term average appreciation in home prices published by Standard & Poors is 5.22% per year. Not too shabby. The problem is that price appreciation doesn’t account for input costs like taxes, maintenance, and mortgage interest. This isn’t to say everybody should just rent. Ask anybody selling the house they watched their kids grow up in, and they will tell you it is so much more than four walls and a roof.

Rental real estate can be great for regular income and a hedge against inflation, but it also carries drawbacks. In an ideal world, a rental property owner would have perfect tenants along with minimal upgrades and repairs. Being a landlord on a small scale sometimes means getting a call at 2 a.m. because the toilet is overflowing. If you are handy, this might not be too big of an obstacle, but the inconvenience of answering these calls can become a bit much. You might outsource these issues to a management company to solve this problem. The average cost for these services is about 10% of the rent. Then there are the issues of liquidity and transaction costs. Selling a house is far from an overnight process and paying realtor or broker commissions can eat into your profit margin. Despite these issues, rental real estate can be a great addition to a portfolio – just be sure to enter the venture only after considering all the nuances.

The other option for real estate exposure is via Real Estate Investment Trusts (“REITs”). These are designed and mandated to pay at least 90 percent of their income to shareholders. These come in various flavors, from those invested in shopping malls to those invested in cell towers. REITs can be accessed privately or publicly. Private REITs typically have higher fees, less liquidity, and a greater chance of picking a relative underperformer. However, those with a keen eye for real estate might be able to enhance their returns by going this route. Publicly traded REITs are more liquid and can be combined into a fund to diversify your risk among different geographical areas and types of REITs.

In conclusion, real estate is a perfectly fine investment under the right circumstances. There are plenty of success stories of people who built their fortune with real estate as the main driver. Ultimately, success comes down to timing and location if you go the route of physical real estate. You could generate a decent stream of income along the way, but the price appreciation you were expecting may not occur at the rate you were hoping for. If you are investing in REITs, they should be part of a diversified portfolio that is monitored and rebalanced. As with anything, make sure you have analyzed the investment from every angle before deciding to make the move.

David Rath, CMT, CFA, is the Chief Investment Officer at Continuum Wealth Advisors in Saratoga Springs. Continuum Wealth Advisors, LLC is a Registered Investment Advisor registered through the Securities and Exchange Commission.

For more information, visit contwealth.com.