Reassessing Your ABLE Account Investment Choices

Posted by Haddad Nadworny on Sat, Jan 19, 2019 @ 07:00 AM

The Special Needs Financial Planning Team John Nadworny, CFP, CTFA | Cynthia Haddad, CFP | Alexandria Nadworny, CFP,  CTFA

We are committed to presenting complimentary educational workshops to  organizations and parent groups. We are currently booking presentations for the Spring 2019 season. Please click here to email Alex Nadworny or call 781-756-1804 . 


Reassessing Your ABLE Account Investment Choices

ABLEBoth the stock and bond markets took a bit of a roller coaster ride in 2018.  In light of this volatility, ABLE account owners may be wise to test and perhaps reassess the investment choices they have made for the funds in their account. 

As part of an advisory group implementing the ABLE account in Massachusetts, we learned that many people opening ABLE accounts stopped the application process when they were asked to determine the investment choices for their contributions. This behavior raised a concern that individuals enrolling in the ABLE program might not have the prior experience or knowledge of financial matters to make the best selection for their situation.

If you began investing in 2015 when the ABLE was first being offered, unless you withdrew funds for expenses, you most probably never saw your account balances decline in 2016 and 2017. During this period, both the stock and the bond markets experienced positive returns. 

Last year offered a different picture; in 2018 volatility returned to both the stock and bond markets and the returns on your investment, depending on when you put funds in, may have taken a hit.  For investors with little experience, it may be a shock to observe 90 cents where they had invested a dollar a short time earlier.  Regardless of how much money is in the account, it is critical to invest the funds in the ABLE account to meet the goals of the account owner.

 In many respects this is an opportunity to learn about how financial markets work.  Now would be a good time to take a look at your account balances and gauge your reaction to the performance of your investment choices in 2018.

 Key Considerations for Your Investment Choices

  1. Your asset allocation, or balance between stocks, bonds and money markets, should be based upon your personal ability to withstand a decline in your balance and your tolerance of market volatility .
  2. Your asset allocation should align with the timing of your goals.

If a portion of the funds in the ABLE are being used for transactions, owners should consider investing these monies with very low risk assets. Depending on how the account is being used, the funds should be invested to provide a mix between funding for transactions and growth for the future. See our case study below about Paul's ABLE choices

The markets have come back since the recent low on 12/24/2018, making now an excellent time to reassess your tolerance for risk and make an adjustment to your ABLE account.  This should be a thoughtful and informed evaluation; federal law allows account owners to change investments in their ABLE account twice per year.  Be sure you are comfortable that the money is invested to meet both your short-term needs and your long-term goals. 

Paul_pexels-photo-212286 Read More  about the ABLE Account.

An example of ABLE Investing:

Paul's ABLE Choices



Content in this material is for general information only and not intended to provide specific advice or recommendations for any individual, nor intended to be a substitute for specific individualized tax or legal advice. We suggest that you discuss your specific situation with a qualified tax or legal advisor.

Prior to investing in an ABLE account investors should consider whether the investor's or designated beneficiary's home state offers any state tax or other benefits that are only available for investments in such state's ABLE program. Withdrawals used for qualified disability expenses are federally tax free. Tax treatment at the state level may vary.

Investing involves risk including loss of principal.

No strategy, including a diversified strategy, assures success or protects against loss.

Asset allocation does not ensure a profit or protect against a loss.





Tags: ABLE Account

Upcoming Presentations & Workshops

Posted by Haddad Nadworny on Sat, Jan 12, 2019 @ 07:30 AM

The Special Needs Financial Planning Team John Nadworny, CFP, CTFA | Cynthia Haddad, CFP | Alexandria Nadworny, CFP,  CTFAWe are committed to presenting complimentary educational workshops to  organizations and parent groups. We are currently booking presentations for the Spring 2019 season. Please click here to email Alex Nadworny or call 781-756-1804 . 

Our Workshops & Presentations





January 18

12 - 2PM


A Step by Step Guide for When Your Child is Ready to Move Out 


Perkins Parent Workshop  

Grousbeck Center
175 North Beacon Street
WatertownMA 02472




6:30 - 8PM

Planning for Two Generations

Dearborn Academy

575 Washington Street

Newton, MA 02458



February 15


Planning for Two Generations

Broad Institute

Cambridge, MA


March 6

6:30 - 8PM

Our Speaker Series- SEE FLYER BELOW

Self- direction: Service Models and How They Work,
a presentation by Bev McGovern of DDS

Shepherd Financial Partners 

1004 Main Street

 Winchester, MA 01890


March 22

1-3 PM

A Team to Carry On-

Planning for the Future When You Are Gone or Have Limitations 


Grousbeck Center
175 North Beacon Street
WatertownMA 02472


April 3

5:30 - 8PM

Resource Fair 

Cotting School

453 Concord Avenue

Lexington, MA 02421 


April 10

9-10:30 AM

Planning for Two Generations

Hopeful Journeys

28 Tozer Road

Beverly, MA 





























Tags: special needs planning workshops

Wrapping things up with The New York Times and on to 2019

Posted by Haddad Nadworny on Sat, Dec 29, 2018 @ 07:00 AM


NYT FBWhile we often publish articles and are quoted in the media, we are pleased to be wrapping up 2018 on a high note: featured in the most recent Wealth Matters column of The New York Times. The article tells the story of Michael and Carole Maguire, parents of Ally who has special needs. When Ally was young and there were many unknowns, they decided that financial planning was the most tangible action they could take to help provide a full life for their daughter in the future. Our team's advice to parents in this situation is featured. Read the article here.


Cindy on panel_LPL Focus 2018 croppedIn 2019, we will continue our presentations and educational outreach to parents, non-profit and community organizations. We are proud to have presented to more than 25 groups in 2018, providing foundational information and resources for individuals and families. Please reach out to Alex to schedule a presentation for your group. 

We send our best wishes for a happy, healthy and prosperous 2019 to all our readers!The Special Needs Financial Planning Team John Nadworny, CFP, CTFA |Cynthia Haddad, CFP | Alexandria Nadworny, CFP,  CTFA

A Talk with My Parents Around Our Holiday Table

Posted by Alex Nadworny on Fri, Dec 14, 2018 @ 06:30 AM

A Talk with My Parents Around Our Holiday Table

A Sibling's Story: Thanksgiving, 2012

by Alex Nadworny

thanksgiving pies_pexels-photo-1634062


It was the first Thanksgiving in a long time where it was just the five of us: Ben, me, Dad, Mom and James, around the table. We gave thanks for all we had and the feasting began.  We ate and talked and laughed until we were as stuffed as Thanksgiving turkeys ourselves. We settled into post-dinner conversation and everyone was relaxed and in a great mood, when I heard myself say to my parents, “Where will James live when you are gone?”

Ben & jamesImmediately Ben replied, “He’s living with me.”

To which I said, “No, with me.”

To which my Dad said, “No way he’s living with either of you!”

This question had been on my mind. I loved James and would do anything for him, but I didn’t know exactly what being his caregiver would entail and how it would impact my life.  I have never been concerned about the planning for my brother; this was a given as my Dad is a professional financial planner and my Mom is an advocate and support group leader. But no one had ever asked me what I wanted for James.

 I knew my parents were handling things from a big picture perspective, like building a home for James, but I wanted to know more about what was involved with supporting his day-to-day life.  My Mom kept a detailed schedule of James’ activities but there was something missing: the many things James required, big and small, that she and my Dad did every day.

Alex & james_cropped Our family always talked about everything and I felt comfortable asking my parents anything; there were never any communication barriers. In this case, it was harder for my parents to hear this question than it was for me to ask it.  While they had a plan all mapped out in their minds, they had avoided talking with Ben and me about our future roles in James’ life. Like many parents, they assumed that caring for James would place a burden upon us and they were not ready to have that conversation. I felt differently; I wanted to know what the plan was and to be empowered to shape my role in James’ life.

 In many families, adult children who have a sibling with special needs have their own lives and for varying reasons, really don’t want to be involved in a hands-on manner; they may live a distance away, have family obligations of their own and/or a demanding career. Still, talking about the who, what, and where of the future support plans for their sibling is an essential conversation to have. A sibling’s expectation does not need to be that they will be a caregiver or have to change their life.  It is a wonderful role to be just a brother or sister. 

 The truth is that while every family is different, this conversation always needs to happen. This holiday season, if the atmosphere is right, and you know what you want to say, respectfully start talking! 

Download our Holiday Tips for Family Talks here 



Tags: families with special needs, siblings, guardianship, planning for a future after parents are gone, parents of people with disabilities

December 2018 Workshops & Presentations

Posted by Haddad Nadworny on Sat, Dec 01, 2018 @ 08:00 AM

We are committed to presenting complimentary educational workshops to  organizations and parent groups. We are currently booking presentations for the Spring 2019 season. Please click here to email Alex Nadworny or call 781-756-1804 . 

The Special Needs Financial Planning Team John Nadworny, CFP, CTFA |Cynthia Haddad, CFP | Alexandria Nadworny, CFP,  CTFA

winter photo pexels


We wish you a happy holiday season. Please join us for our complimentary December 2018 presentations. 

Please reach out to Alex for more information and follow us on Facebook!   



December 4

6:30-8:30 PM            

Planning for Two Generations

Waltham High School

617 Lexington St,

Waltham, MA 02452


December 5

6-8 PM

Planning for Two Generations


4 Omni Way

Chelmsford, MA 01824


December 11

7-8:30 PM

Planning for Two Generations

Winchester Town Hall

71 Mt Vernon St,

Winchester, MA 01890 





Tags: special needs presentations

Home Equity Line of Credit?  Here's What You Need to Know

Posted by John Nadworny on Wed, Nov 07, 2018 @ 08:01 AM

The Special Needs Financial Planning Team

Cynthia Haddad, CFP® | John Nadworny, CFP®, CTFA | Alexandria Nadworny, CFP®, CTFA

Download this paper in PDF.

If you have a Home Equity Line of Credit (HELOC), it may have become a whole lot more expensive recently.

equity_englishHere’s why:

Your tax deduction may have been eliminated. The Tax Cuts and Jobs Act of 2017 eliminates the deduction for interest paid on home equity loans and lines of credit unless they are used to buy, build or substantially improve the taxpayer’s home securing the loan. This suspension begins in 2018 and is slated to phase out in 2026.

Case Example: To provide the down payment for a cottage at the beach, Charlie took a $100,000 HELOC in 2017 at a rate of 4% on his primary residence. Charlie is in the 30% tax bracket, so while his HELOC interest totaled $4000, the real after-tax cost was $2,800. The way Charlie looked at it, his HELOC rate was really 2.8% rather than 4%. Enter the new tax law of 2017. Beginning in 2018, purchasing a second home is no longer considered a qualified use of a HELOC for tax purposes. This means the real cost of Charlie’s HELOC is now the same as the rate he is being charged by the bank. And there’s more…

Short-term interest rates have been rising. Potentially even more impactful than losing the interest deduction on your HELOC, are rising short-term interest rates. Short-term interest rates are highly responsive to the actions of the Federal Reserve raising the fed funds rate. The Federal Reserve has had a policy of small, but steady, rate increases, having raised rates six out of the last seven quarters! Changes have occurred so quickly, you may not even be aware of how much you are paying.HELOCs are variable rate loans and are many times pegged to the prime rate. The prime rate is the rate banks charge their most credit-worthy customers and is largely determined by the fed funds rate. (Investopedia)The table below shows the prime rate for each year 2015-2018. (JP Morgan Chase)


Prime Rate










As you can see from the chart, the prime rate has increased 1.75%, or 175 basis points over the past 3 years, with another hike probable by the end of 2018.

Case Example: Let’s catch up with Charlie. He cannot deduct the interest on his HELOC in 2018 and, to make matters worse, as short-term rates have climbed, the rate on his HELOC loan has increased. By October 1, 2018, Charlie’s interest rate has risen to 5.25%. With the interest no longer tax deductible, the actual annual cost of his HELOC is now about $5,000, rather than his prior after-tax cost of $2,800!

What are your options?

Match your needs with the proper financing tool.In discussions around borrowing money, we employ a fundamental standard of finance called the matching principle. The matching principle states that short term needs should be financed with short term debt and longer term needs with long term debt. Although the draw period of a HELOC is typically 10 years, because it is a variable rate loan, it should be considered as a short-term financing tool. This is especially important in a rising interest rate environment.Many disciplined savers find it useful to view their finances in distinct buckets or categories for the purpose of implementing their budgeting or savings strategies. An example of this could be setting aside money to buy a new car or saving a specific amount each pay period toward a vacation. In some cases, individuals may extend this strategy to employ funds from a HELOC to help meet other obligations or make a specific purchase rather than taking the money from their savings. In the past, when rates were consistently low and the interest was tax deductible, this approach may not have been costly. However, in today’s interest rate environment, equity loans are no longer “cheap money”. It may be wise to consider paying down a HELOC loan.

Utilize the cash in your “rainy day” or emergency fund.The good news about short term interest rates rising is that both savings accounts and money market funds are paying a bit more interest. Currently, the top money market funds are paying about 2% interest while the HELOC rate is 5%. (source: If it is many years before your HELOC draw expires, this line of credit will be available to you and can satisfy your cash needs should an emergency arise. It may make sense to use the savings in your “rainy day” or emergency fund to pay off your HELOC. This option may make even more sense now with interest paid on the HELOC not tax deductible in many cases. Note that you are paying down the balance of the HELOC while leaving the line of credit open and available to you. While this strategy may sound contrary to the sound advice of always having an emergency reserve in the bank, remember, you have access to the equity line by simply writing a check. Why would you have savings in a money market account earning approximately 2% while you are paying 5% on the HELOC?

Consider refinancing your mortgage. If you have both a HELOC and an existing mortgage and a near-term payoff is not realistic or practical, consider refinancing as an option. In general, while HELOCs are tied to short term rates, such as the prime rate, mortgages are tied to longer term rates, specifically the 10-year Treasury Note. The table below depicts the 10-year Treasury rates ( Market Data) and the average U.S. 30-year fixed mortgage rate (FRED Economic Data) along with the prime rate over a 3 year time spectrum. This table serves to illustrate how quickly HELOC rates have increased in comparison to mortgage rates.


Prime Rate (HELOC)

10 Year Treasury

US 30 year



















As you can see from the data above, HELOC’s have gone up 1.75%, while 30-year loan averages have increased by about .75%. Remarkably, borrowing for the short term (@5.25%) is currently more expensive than borrowing for the long term (@4.72%)!The yield curve is a line that plots the interest rates, at a set point in time, of bonds having equal credit quality but differing maturity dates. (Source: Investopedia). We currently have a flattening yield curve with rates on the short end of the maturity spectrum reacting more quickly to increases in the fed funds rate than rates on the longer end. You may want to consider locking in a mortgage at this time to satisfy the balance of the HELOC. Another wrinkle to be aware of, the Tax and Jobs Act of 2017 has lowered the cap on the mortgage interest deduction. The deduction of interest on a new mortgage for a first or second home is now capped at $750,000 (previously $1,000,000).If the mortgage option is out of reach or impractical for you, another option is to talk with your bank and ask if you can convert the HELOC to a home equity loan. While a home equity loan will have a higher rate of interest than a mortgage, due to it being second in line or subordinated to the primary mortgage, it has the benefit of having a fixed rate of interest. Every situation is different; you may be fortunate and have an extremely low mortgage rate and refinancing may not be appropriate. We are here to help you walk through the analysis to help determine what actions would be most appropriate for you.

The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual, nor intended to be a substitute for specific individualized tax advice. We suggest that you discuss your specific tax issues with a qualified tax advisor. There is no assurance that the techniques and strategies discussed are suitable for all investors or will yield positive outcomes. Examples are hypothetical for illustrative purposes only. Individual results will vary. Shepherd Financial Partners and LPL Financial do not offer mortgage services.




FRAUD ADVISORY: Beware of Phone Calls with Social Security Caller ID

Posted by Haddad Nadworny on Sat, Nov 03, 2018 @ 08:00 AM


social_security_logoThe Acting Inspector General of Social Security, Gale Stallworth Stone, is warning citizens about an ongoing caller-ID “spoofing” scheme misusing the Social Security Administration’s (SSA) national customer service phone number.  SSA has received numerous reports of questionable phone calls displaying SSA’s 1-800 number on a caller-ID screen. 


The reports indicate the calls display 1-800-772-1213, SSA’s national customer service number, as the incoming number on caller ID.  People who have accepted the calls said the caller identifies as an SSA employee.  In some cases, the caller states that SSA does not have all of the person’s personal information, such as their Social Security number (SSN), on file.  Other callers claim SSA needs additional information so the agency can increase the person’s benefit payment, or that SSA will terminate the person’s benefits if they do not confirm their information.


SSA employees do contact citizens by phone for customer-service purposes, and in some situations, an SSA employee may request the citizen confirm personal information over the phone.  However, SSA employees will never threaten you for information or promise a Social Security benefit or approval or increase in exchange for information.”  See the full advisory at the OIG website.

Tags: Social security income, cybersecurity

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