Matt McCoy

Matt McCoy CFP®, ChFC

About Matt

“Comprehensive planning is the key to achieving financial goals. I believe in planning through a process - not product!”

Matt is an experienced financial advisor who has helped his clients accomplish their financial goals for over nine years. He earned a B.S. degree in Economics. In addition, he has been certified by the College for Financial Planning as a CERTIFIED FINANCIAL PLANNER® certificant, which focuses on comprehensive financial planning. Matt also holds the Chartered Financial Consultant (ChFC®) designation earned through The American College which focuses on the many uses of life insurance for financial and estate planning.

He is committed to a different way of thinking that doesn’t start with product but with process. His primary focus is on holistic financial planning tied to regular interaction with clients and their other core advisors. He is able to address each client’s unique financial situation through a detailed, risk focused approach. This process, coupled with his education and experience, provides the foundation for him to deliver solid solutions for clients.

Matt resides in Hixson, TN with his lovely wife Melanie and stepson Justin. He is an avid sports fan with a special affinity for baseball. He is also a student of his industry and enjoys financial reading and research.

Certifications

Designations

Registrations

Individual CRD #4855742

Certified Financial Planner (CFP) is a designation issued by the Certified Financial Planner Board of Standards

Educational/Exam Requirements:

  • Completion of CFP-board registered study program, or alternative degree or certification, demonstrating mastery of over 100 topics surrounding financial planning
  • Pass 10 hour exam testing knowledge in financial planning situations

Prerequisites/Experience Requirements:

  • A bachelor’s degree (or higher) from an accredited college or university, and
  • Three years of full-time personal financial planning experience

Public Disciplinary Process? Yes

Continuing Education Requirements: 30 hours every two years

Chartered Financial Consultant (ChFC) is a designation issued by the The American College

Educational/Exam Requirements:

  • Must complete nine college-level courses, seven required and two electives
  • Requires nine closed-book, course-specific, two-hour proctored exams.

Prerequisites/Experience Requirements:

  • Requires three-years of full-time, relevant business experience within five years of applying for designation

Public Disciplinary Process? Yes

Continuing Education Requirements: 30 hours of continuing education every two years

Insurance License:

TN #0920439

Typical Clients

How I Can Help

Fee Structure

Fee-only Hourly Commission and Fee Commission Other Contingency
Learn more about how advisors are paid in our Guide to Advisor Compensation.

Typical minimum Client Assets:

$250,000

Contact:

Phone: (706) 956-2726 Address: 3001 S. Broad Street Suite 200
Chattanooga, TN 37408
matt@kumquatwealth.com

Matt has answered 11 questions

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Matt McCoy
Answer added by Matt McCoy | 293 views
2 out of 2 found this helpful

Some foreign CD rates sure do seem to put U.S. rates to shame these days, however it could appear more

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Some foreign CD rates sure do seem to put U.S. rates to shame these days, however it could appear more attractive than it actually is.  The key factor to remember is that you will need to convert your proceeds back into U.S. dollars upon maturity, so the exchange rate fluctuations will play a big part in how much you actually realize from your investment.  The basic premise of several popular interest rate parity theories (I will not bore you with the details here) is that you should receive the same return regardless of whether you invested in the higher yielding foreign security or the lower yielding U.S. security.  The idea behind these theories is that any opportunity to exploit the yield difference will be arbitraged away - in other words, more and more investors would engage in these transactions until the benefit of the yield differential disappeared (this would happen almost instantaneously).  For the U.S. investor in this case, the result would likely be that the foreign currency depreciated relative to the U.S. dollar and they would therefore be exchanging less foreign currency back into dollars upon maturity.  We all know that the real world can differ significantly from theory, so this is certainly not meant to imply that foreign CDs are a bad deal.  Due to currency volatility however - especially in the very high yielding currencies - it is advisable to consider the CDs as a more risky investment than a traditional CD in the domestic market.  Be careful when viewing the foreign CD as an "apples to apples" comparison with the U.S. CD since there may be some additional risks. Just keep in mind that exchange rate fluctuations will have an impact on your investment. 

Another consideration is to gain an understanding of the protection you are afforded for such an investment.  Several U.S. institutions will offer foreign CDs (denominated in the foreign currency) to be purchased through their platform and will extend FDIC insurance, however the FDIC insurance does not cover the fluctuations in the foreign currency.  Be sure to understand the policy thoroughly prior to investing.  Also be sure to understand all of the fees incorporated in the price since some institutions may charge you to convert your currency.

Analyzing and forecasting exchange rates is an extremely complicated exercise, so caution is warranted. There are a lot of moving parts and the above considerations are simply a starting point for your evaluation.  I hope this has helped to get you started and best of luck!

 

Matt McCoy
Answer added by Matt McCoy | 625 views
1 out of 1 found this helpful

First of all, congrats to you for establishing a savings plan and for diversifying your account structures. 

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First of all, congrats to you for establishing a savings plan and for diversifying your account structures.  Great question and one that seems be overlooked quite often.  I believe it is key to take a consolidated look at all of your investment accounts; so yes, do consider your current allocation prior to investing in your Roth IRA.  Not only will you be looking to diversify through asset allocation, you will also be diversifying through asset location

Keeping in mind that your distributions from your Roth will be completely tax free (as long as you meet the requirements), your Roth IRA is a great place for tax inefficient investments (such as fixed income) as well as those that are likely to appreciate in value more than others.  None of us know exactly which investments will appreciate the most, however high growth areas such as emerging markets or international small caps have historically fallen in this category.  And the interest from any fixed income securities has the potential to be received tax free in the future. 

 The most important step will be to first determine what your overall allocation needs to be based upon your financial goals - don't just invest in the expected high growth (and therefore higher volatility) markets simply due to the potentially higher future values.  Be sure it fits within the allocation needed to meet your goals.  Consider engaging a financial planner to help you quantify your goals and determine your overall allocation.  From there you should be able to determine the most efficient location for your investments.  Great job thinking ahead and best of luck!

Matt McCoy
Answer added by Matt McCoy | 62 views
1 out of 1 found this helpful

Congratulations on your upcoming retirement!  You are certainly taking the correct approach by looking

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Congratulations on your upcoming retirement!  You are certainly taking the correct approach by looking at all angles rather than allowing the temptation of low mortgage rates lure you in immediately.  Without knowing your complete financial picture, I will simply offer my general thoughts on a decision such as this.

In general, I tend to advise against carrying mortgage debt in retirement – and really anytime that you can afford not to (more on affordability below).  This is particularly the case if you are considering a longer term mortgage note since you can effectively end up paying twice as much for the home due to interest; not including taxes and insurance.  And even though you may be able to deduct your mortgage interest, keep in mind that you are still paying interest.  For example, assume you are in the 28% tax bracket.  For each dollar you pay in interest, you get to deduct 28 cents.  You are effectively paying 72 cents in order to deduct 28 cents, and that doesn’t seem like a very good deal.

My first piece of advice would be to determine how your sources of retirement income match up to your desired retirement lifestyle (without the home purchase), if you have not already done so.  This will help determine where you stand as far as a withdrawal need from your retirement assets.  If you have enough income from guaranteed sources – pensions, annuities, social security – to cover your lifestyle needs, there may be no need to keep the funds invested and attempt to outperform the interest rate.  In other words, adding the mortgage payment to your lifestyle expenses could require you to access your retirement assets, which in turn could tempt you to position your assets with more risk than is needed.  I look at the tradeoff in a rather simple manner:  with investing rather than paying cash, you are relying upon an unknown variable (market returns) to cover a known cost (mortgage principal and interest). 

Another issue to consider would be the possible move that you mentioned.  Let’s say you decide to move south in a few years and you have purchased your lake house using a mortgage.  You find the perfect home and purchase with another mortgage, however you have trouble selling the lake house and you are not receiving any rental income.  In this situation, your lifestyle expenses are driven up by another mortgage payment until you can find a buyer for the lake house.  This could potentially put a big squeeze on your cash flow (and retirement assets), so is certainly worth considering. 

This certainly isn’t to say that mortgages are always a bad deal and that you should not consider that option.  As far as debt goes, deductible interest is always better than non-deductible interest, however I do not believe that should be the only reason to take on debt.  I also strongly believe in the emotional benefits of being debt free – something that you and your wife are familiar with since you are debt free (great job!).  There are a lot of moving parts when making a decision such as this that can make it more difficult than it seems on the surface.  While this is not a recommendation one way or the other (and not an exhaustive list of pros and cons), I hope this has at least helped you look at it from a different angle.  Best of luck to you both and safe travels!


Matt McCoy
Answer added by Matt McCoy | 48 views
1 out of 1 found this helpful

It sounds like you have good plan in place to tackle your current debt load - well done!  I'll provide

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It sounds like you have good plan in place to tackle your current debt load - well done!  I'll provide a few points regarding the use of your home equity and provide a few additional suggestions (some of which you may have already considered):

  • I would agree that interest rates are very favorable for borrowing at this point.  However, I would suggest ensuring that your loan is a fixed rate rather than a floating rate or adjustable rate (since the latter will move with interest rates).  Also, comparing your debt payments to your expected rental income would also be advisable.  If the expected rental income covers or exceeds your debt payments, you would be able to maintain the aggressive payments towards your other debt (particularly the higher rate debt).  
  • I would also consider "stress testing" your investment.  In other words, what would 100% vacancy in both rental properties do to your cash flow?  It sounds as though you have excess cash flow since you are making additional payments, however do you currently rely on rental income to make the necessary debt payments?
  • In any situation where you are considering additional debt, it is also advisable to evaluate the security of your income.  This is particularly important if only one member of the household is working outside of the home.  An important part of an overall financial plan is to ensure that you have liquid assets available in case of a temporary loss of employment (a reserve/emergency fund) so that you don't put your assets at risk. 

With your experience in rental real estate and ability/willingness to manage maintenance issues, it appears as though you have good cost controls.  Just be sure that you are able to continue to aggressively pay down your higher rate debt.  Best of luck!

Matt McCoy
Answer added by Matt McCoy | 86 views
0 out of 0 found this helpful

This type of coverage is often overlooked, however it is extremely important during your peak earning

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This type of coverage is often overlooked, however it is extremely important during your peak earning years.  If you are not covered under any professional associations, you will likely be limited to obtaining coverage through a private provider.  Your first consideration would be to determine your actual coverage need.  This is not always equal to the maximum benefit that can be underwritten since there are a multitude of factors to consider.  It is advisable that you discuss this in depth with a knowledgeable professional, however a few of the more important considerations relate to your current progress toward financial goals (retirement, etc.), remaining work life (how much longer you plan to work), current level of expenditures, and current level of reserve funds (emergency or savings fund).  You will also likely find that each of these factors will also help you in determining any of the "bells and whistles" that may need to be included in the policy - such as inflation protected benefits or the ability to increase your coverage in the future without medical underwriting.  Be sure to understand all of the coverage definitions as well as the details regarding any of the policy riders that may be presented.  You certainly want to be sure that you are covering the correct risk!

Also keep in mind that if you pay the premiums for the policy, the benefits will be received tax free (you are paying premiums with after tax dollars).  This means that with a private policy, you will want to focus on the net amount of income you receive now rather than your gross wages.  With the typical group coverage, your employer would pay for the coverage and thus your benefits would be taxable to you as income. 

You have certainly taken the first - and most important - step by recognizing that there is a need.  By giving your current situation some thought, you should be well equipped to have a substantive conversation with a financial planner or insurance agent regarding your necessary coverage.  Kudos for taking the first step and best of luck!


 

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