Adding family-office services and software, with Renee Wolgin

Investments are not FDIC-insured, nor are they deposits of or guaranteed by a bank or any other entity, so they may lose value.
 

Hello! And welcome to the PracticeLab podcast, where we talk to top advisors about what makes them successful, so that you can apply those lessons in your own business.
 

I’m your host, Will McKenna, and today we are joined by Renee Wolgin, director of the family office at Telemus, a large RIA with offices in Detroit and Chicago, and assets of more than $3 billion. An accountant by trade, Renee represents a new trend in the industry, in which accountants and attorneys are joining wealth management firms to provide holistic service to high net worth clients.
 

In this episode, Renee talks with my colleague, Leslie Geller, about what it means to be a virtual family CFO, the customized services she can offer and the “one-stop shop” value that it brings to clients. Renee also explains how her team uses software that serves as a “digital vault” for client information — and why it becomes a kind of heirloom for clients.
 

So let’s jump into this episode of the Practicelab podcast.
 

Leslie Geller: We're here with Renee Wolgin from Telemus. Welcome, Renee, thanks for being with us here today on PracticeLab.

Renee Wolgin: Thank you. Thank you so much for having me. 

Leslie Geller:  So tell us a little bit about Telemus and the types of clients you service. And most importantly, your role there.

Renee Wolgin: Telemus is a fee-based registered investment advisor. They have offices in Detroit and Chicago and a bit of a presence in LA. They started the firm about 16 years ago. We just had our 16th anniversary, and we're now managing over $3 billion in assets, primarily for wealthy individuals, their families, their foundations. And really have a holistic approach to what they refer to as full financial life management. And I guess, as part of that approach, is bringing me in. My role at Telemus is to run their family office, or what we refer to as the virtual family CFO, which we just started in January 2020. 

Leslie Geller:  What is your background? Because I think that's really important for understanding this conversation we're going to have.

Renee Wolgin: OK, so I spent the last 20 years practicing public accounting, primarily for, you know, what would be your typical Telemus client. So, primarily for high net worth individuals, their families, their children, their trusts and, you know, their closely held businesses. So a lot of real estate, a lot of law firms, medical practices, not much in the manufacturing world. But really dealing on a day-to-day basis with these high net worth clients that are also Telemus clients. 
 

I started at PricewaterhouseCoopers out of college, and then left there to work for a smaller CPA firm doing, you know, tax planning, projections, consulting, compliance. So really, which I think really, of course, prepared me for, for what the role I took on at Telemus.

Leslie Geller:  There's definitely a trend we're seeing where advisors and firms like yours are adding experienced professionals like you, right, like CPAs, former estate planning attorneys to their teams. What do you think is the value-add here? And what do you spend your days doing with clients? And maybe a few specific examples, especially around how you've really seen that added value of your skill set play out?

Renee Wolgin: Yeah, and it really is commonplace in firms today. This is what they're really trying to do. And I think Telemus was somewhat ahead of the curve in that department. They have, since almost since inception, they have had a wealth advisor, who is a former Arthur Andersen tax partner. And his role really is to talk to clients about strategic estate planning, wealth transfer, and really coordinate also with CPAs and attorneys. And then a few years ago, they brought in an insurance person who, their job is not necessarily to sell insurance for our clients, but he will take a look at their insurance and review it. If their coverage is adequate, you know, there's no problem in saying your coverage is adequate. If not, we can help them adjust their coverage to what it needs to be, or deal with their insurance agent to help facilitate updating those policies. 

So when I came in, that was kind of bringing in the last piece of the puzzle. And really, the goal is to promote full financial life management. We really want to be a one-stop shop, to kind of centralize their financial universe under one roof, and then build those relationships with their outside professionals to promote a real collaborative effort. And understand what their goals are, where they are now, where do they want to go? You know, what do they want from generations to come? And really help support that and help them preserve their legacy. 

So in having the wealth department, the insurance department, and now family office (in addition to the advisory services we were already providing), it really is kind of a one-stop shop. And I think it makes clients feel comfortable that we really have an understanding of what their goals are, and that we can ensure that all of their professionals are coordinating and acting really in their best interests. 

Specifically, what we're doing for clients, I would say varies from client to client. You know, the great part about a multifamily-office solution is that we can customize our services to meet their needs. So it's not all or none. No two families are the same. And there's no two ways to service them. So for some clients who may have a family member who's deteriorated and can no longer perform certain financial functions on their own, or they want to get that out of the household, we're doing bill pay and account reconciliations and oversight of those household accounts. 

We're doing a lot of, I think, what a lot of people are missing. And what they find intriguing that we're doing is tracking their privately held investments. So everyone has investment advisors that are tracking their publicly held securities and alternative investments that are held within the brokerage accounts. But who's really looking at the hundred real estate LLCs that they might have an investment in, and really figuring out how those assets are deployed and diversified? 

So we're kind of tracking capital costs, distributions, reconciling to the K-1s. Kind of segregating them by industry, so that they know how much is in residential real estate. How much is in home improvement? How much is in cannabis? So that they can really have a clearer picture of their wealth overall. And we're giving them the tools to view their wealth kind of in a way that they've never been able to look at it before. And hopefully paint a clearer picture for them of where they stand. 

Leslie Geller:  You and your team really pride yourselves on simple and seamless execution, which is obviously the easiest way for clients to see the value in what you're doing. Could you talk a little bit about this? And what sets you apart, you and Telemus apart, in this family office world?

Renee Wolgin: I think there's many different things that may set us apart from other family offices. I think my prior experience has really enabled me to kind of see the need for a service like this and what they're missing. So on the other side, as far as, let's say, tax return preparation goes, I'm sitting here preparing tax returns, and then I'll see a little scratch piece of paper that might refer to something that might trigger me to think “Did he? Did they invest in something? Or is there an account here? Or should I be looking for a K-1? Or should this really be in the name of a different entity?” You know? And it's not until you see those little things that trigger you to ask the questions that then maybe a lot of CPAs would kind of shove it over and not even ask, because if they don't have the form, it doesn't exist, you know? 

So it really, you know, we were asking questions. And at that point, we weren't finding out until after things had already happened. So part of what we're doing is really trying to get to get in front of those events, so that we can help structure them in a way that is most beneficial to them. Not only from a family planning, wealth transfer perspective, but also from a tax perspective. So I think all of our experience kind of leads us to know: When do we need to ask questions, when do we need to consult with attorneys or CPAs, and really promote that collaborative effort? So I really think a lot of it is and I think what we excel at is building those relationships with their outside advisors. We don't have to be the end-all be-all, the smartest people in the room. But we know how to coordinate those efforts. And I think that that's really important.
 

Also, I think from the onset of this, I was doing a lot of research as to what other family offices were doing from a software perspective — a process and practice management perspective. And what was going to be the best way to execute this because, of course, you know, we were starting from scratch. This did not exist at Telemus. And I found there's, you know, there's kind of three parts to it: 

• Telemus had their investment advisory software, that wasn't going to change because we were adding a family office. So that was something that we had to figure out how to work with that. 
• And then most family offices, from what I found, for a write-up tool for financial tracking, use QuickBooks. 
• And then the other part was, what are we going to do to kind of keep track of what we're doing, and also maintain all these documents for clients, and also enable them to be able to see what we're doing? 

And so we've, we've started using this kind of digital vault, it's called, or I call it. It's a software that really kind of houses everything family office related, so we take those three tools where it really presents information to clients that they haven't seen before. So you know, we set up a chart of accounts that contains not only their brokerage account values, but also all of these private investments that they're holding and recording the activity where you can run a monthly, you know, income and expense statement for them. So they can really see what's going in and out. We're also doing feeds if they want from their actual bank account, so they can see what their personal spending really is, and their cash needs are, on a monthly basis. 

And then, from a tax management perspective, I guess we're also coordinating with all of their contacts for those private investments to be sure that we're being CC’d on all correspondence that might come out the door. That we're getting copies of all of the K-1s. So that we're able to: number one, ensure that what that K-1 reflects is exactly is what happens. Ensure that the distributions that they're getting are what was promised to them in the operating agreements or the PPMs. And then, you know, funneling all that information to the CPA. So we're not looking at it after, we're looking at it before, and then we're able to know what's missing. So for clients, that makes their life a whole lot easier, because we're really streamlining that communication process for them. And also providing the CPAs with a nice clean package for preparation of their tax return. 

And really, I think that when they see the coordination of efforts amongst their attorneys and the CPAs, and the emails going back and forth, and the conversations that we're having, we're really taking the initiative to get involved and ensure that things are titled the way they're supposed to be. And wires are being initiated as they're intended. They see right away, kind of how much easier it is. And they really feel a lot of peace of mind that that somebody really understands their picture and has that full financial life oversight in the event, God forbid, you know, something should happen.

Will McKenna: OK, so we heard Renee talk about her role as virtual family CFO and how she is able to get ahead of her clients’ tax, estate, insurance, real estate and private investment issues through active coordination with other advisors and centers of influence or COIs, and how she figured out the software needed to track and maintain important documents for her clients. Next, Renee talks more about the software, which she calls a “digital vault” for client information, and compares it to an asset or heirloom capturing an individual’s financial history. 

Leslie Geller:  So you mentioned this digital vault technology, we've talked about that a few times in our conversations, that you've implemented. And you mentioned it so casually. But I have a feeling that it was a much longer and more involved journey in finding this type of software that would fit your business and then adapting it to your needs. And I think that's really an important part of your execution. And so maybe could you talk a little bit more about how you found this software? And how you've worked with the developer to make it fit your specific needs?

Renee Wolgin: Yeah, absolutely. So before we started, before I went to tell them as I was doing, of course, as I said, a lot of research and software demos and, you know, talking to the different people, and I came across the software. It's called iPaladin. And I had a conversation with the software developer, Jill, whose experiences were actually very similar to mine. She was an attorney by trade, practicing law. And, you know, eventually ended up working for a single-family office. And she developed the software from scratch, to tailor it really to her needs, based on what she needed to run her family office effectively and efficiently. And throughout my research, this was kind of the missing piece to the puzzle in my mind. I'm using it, I think differently than most of her other clients. Because I'm, I'm probably one of her only, I would say, multifamily-office clients, it's really mostly single-family offices and, you know, professional service firms. 

So when I came across the software, it was so eye-opening. Because it's totally geared, as I said, towards family office. But it organizes a family's wealth by ownership. So you can see, with the click of a button, all of the hierarchies of ownership of the assets. And you can tailor it really; you can have additional users, so the clients can log in and, or the attorneys can log in, or the CPAs. And we can restrict their access in a very specific manner, so that they can only see what they the client wants them to see. 

And it also is a practice management tool. So not only does it store everything from forms of identification, to estate planning documents to insurance policies, just subscription documents, tax returns, so everything is stored in there and is organized in a very precise manner geared towards family office. So everyone can be looking at the same information. 

But also, it allows you to use it as a practice management tool to kind of set your to-do list, for example. So every user has their own dashboard. But that's how I know… I'm thinking how am I going to know what I have to do on a daily, weekly, monthly basis? And what if I hire something, someone? Or what if something happens to me, how are they going to know what has to be done for these families so that nobody is left hanging, and that balls don't get dropped and things fall through the cracks? And you can really customize it for your to-do lists. For example, “Ensure that so-and-so's distribution was direct-deposited into this account,” or “Remind so-and-so to renew their global entry card.” And it rolls with this perpetual timeline, and nothing is deleted. There's a full audit trail; you can't change it. And it's military-grade security, so that nobody else can get into it, if not authorized. 

So I found it to be… I hadn't seen anything like it. And it really not only allows you to view, it's not a financial tool, but it allows you to view everything by ownership. It's searchable, and has a messaging feature and a calendar, whatever. But it organizes everything in such a manner that it's so easy to find things, access things and, at the same time, you know, we can show our client everything that we've been doing for them. And they can log in at any moment and say, what, you know, “Why am I paying Telemus all this money? What are you doing?” and it's right there in front of them. 

Most family offices, for their to-do lists, are using Excel checklists or dashboards like that. And to me, I was starting this from scratch. I wanted to do something that could kind of grow with the family-office practice. And setting up spreadsheets is not my favorite thing to do, or my forte, and allows room for a lot of error. So I wanted to avoid that and start with something a little more sophisticated out of the gate so that we were positioned to grow. And that also the clients could see what we were doing. It's not all stored on our server, it's stored in the cloud, where it’s there, in Italy, they can log into iPad and, and pull up their passport right there. Or, you know, some sort of medical power of attorney or, you know, anything that they might need to refer to at a moment's notice. And I think like, now, during the pandemic, you know, more so than ever, we've realized the need to access information anytime, anywhere. So I think that our timing was somewhat impeccable, because the need for something like this is realized now, I think, more than ever. So for us, it's been great.

Leslie Geller:  I think one of the most interesting things about this digital vault technology that you've implemented is how it integrates the client into the relationship, right? It's not just used for your internal purposes, or even your interactions with attorneys, CPAs, right? Not just interactions with CEOs, but that it's very much a front-facing piece of your business. And I think you spoke to it a little bit how it's helping you justify your and Telemus’ value, because clients see what you're doing every day. And when you're prospecting for clients, right? When you're having a meeting with a prospect, do you showcase this technology? Is this a big differentiator for you guys?

Renee Wolgin: I think it is. Because I think most of our clients are bogged down by this administrative burden of handling their personal finances, as well as their businesses or either philanthropy or their travel. You know, we want them to really be able to pursue what they're passionate about and relieve them of that burden. At the same time, they may have their administrative assistant or a payables clerk or CFO handling all of their personal finances. But they also may just be too busy, and they don't want to be bothered. So for us to have everything in this spot that they can access at any time really gives them peace of mind and helps them sleep at night. 

I mean, they also might have their family members that really have no idea how their wealth is comprised. And this really helps paint that picture for them. And you know, when I present it to them, I guess when we're prospecting, what we're doing in my mind is really creating an asset for these families, to grow with them. It's somewhat of an heirloom. And it's something that really is documenting why certain decisions were made, when they were made. It's a full complete record of, I'm not going to say everything because we're not necessarily going back. But on a go-forward basis, you know, we're documenting everything. So that there's history there, and it really is part of their legacy. 

And then take it a step further, when they sign in, and we're onboarding them. And then we show them what we've created. And they see it with their actual family and their entities and their interest and their documents. To them, it's like, “Wow!” You know, they're, they're thrilled. Not everybody uses it, but when, but they know it's there. And I've had some comments, “Can you show this to my attorney and CPA?” Like, they're so excited about it, because they've never been able to see it all in front of them on one screen. So that definitely when they see the demo, it really, it is a big differentiator for us, I think.

Leslie Geller:  And how have COIs, so specifically estate planning attorneys, CPAs, any other type of attorney that works with the client, how have they responded to your integration of this digital vault technology with the families that you work with? 

Renee Wolgin: They love it, they love it, they're very impressed by it. I mean, and they, I can see their wheels turning and, you know, by the questions that they asked when we kind of present to them what we're doing. I mean, we've had various meetings with COIs, and, and just kind of showing them what they're doing. And I think that they knew that their client always needed something like this, but they didn't necessarily know that it existed. And I think also, they're happy that they don't have to be the ones doing it, that we're kind of taking that on for them. But for them, I think it makes them feel better that they can call me to dig up some document and they don't have to call the client, they can leave them out of it. And they feel comfortable knowing that someone else is taking care of things for them. So it's been very well received. And they do send referrals and things like that. So it's been well received by everybody we've kind of presented it to, and I think that there's a need for it.

Leslie Geller:  I mean, I can speak to that, very strongly. I was an estate planning attorney for 14 years, and I would have loved for the advisors I work with to have this type of comprehensive technology, simply for the institutional knowledge it creates. But I love how you called it an heirloom and or an asset, because it really is. And the wealthier the family, the more valuable that asset is to the family. And one thing we also talk to advisors about all the time and investors is the importance of communication and transparency, right? Like that's everyone's always looking for. How do I make sure my kids work hard? How do I make sure my kids, you know, inherit this money in a healthy way? And our point, and I know we've talked about this before, is that it's all about communication and transparency. And I mean, this is the ultimate tool for those purposes.

Renee Wolgin: Yeah. And she, you know, designed it specifically for that, as she was, you know, building up her own the single-family office that she was working for. What's great is that, you know, she has a gajillion other clients and subscribers, you know, but we've kind of built this relationship. And you know, I'll call her and be like, “I really wish I could filter the data like this,” or “Have you ever thought about adding this field or feature or tool?” And within minutes… 

I think that what’s great is we have this rapport, and I'm using the software in a different way than other subscribers. So I'm kind of presenting to her ways to modify it that would make it more useful not only to me, but to the client to really give them a clearer picture of their wealth. Or, you know, drive maybe more financial information or be able to run certain queries where we can gather data much more quickly. So she is so receptive to everything that I've suggested. And slowly but surely, it's changing every day. She's always implementing new things, and she really hears what I'm saying. And so I assume what other subscribers are saying, and makes those changes happen. So I feel like I'm kind of almost part of the development of it, you know, which also feels really good. And the, and the families, hopefully, you know, it will grow with them for years to come, and they will, they do look at it as an asset.

Leslie Geller:  How are you guys marketing this service? And how are you using it to grow your assets, get new business? Are you specifically focusing on it? Or is it more organic and part of your general marketing efforts?

Renee Wolgin: Well, initially, we launched as I may have said earlier, we launched, we launched the family office based on a very specific need from an existing Telemus client. So we started it with a very small specific task and a very small portion of this family's wealth. So initially, that's how it started, and I think as it's grown, number one, you know, I started by marketing it to, I would say, clients that I knew of mine that definitely had a need for this service. Whether it be that all of their finances were engrossed with their business personnel, or that they were invested in so many different private investments that that they don't even know and nobody's keeping track of it. So it started with that, where things were people that we knew already had a specific need, where we have a history with them and know their background. 

But I think now more so it's used as a tool for many clients that are not existing Telemus clients. And because they may have had a liquidity event, or they may have been a prospect for years and just have never taken that plunge. Or maybe they only have a small amount of their wealth with Telemus. We're not selling investment advisory services, along with the family-office services. We're keeping it as a totally separate service. So it's not a prerequisite that you're telling this client to be a family-office client. And we have gotten a few different clients that that come in because they're intrigued by the digital vaults or the ancillary services that we're providing. And then, slowly but surely, as they grow more confident with us, they're more inclined to move their assets over. So we come in, we have a fiduciary duty to really act in their best interest. I ensure them that, you know, the family-office information is kept totally separate from all of the other Telemus personnel that don't work with the family office, because confidentiality is always a concern, especially if they're not an existing Telemus client. And we've had I want to say some of the greatest success with bringing in new Telemus clients through the family office. It’s kind of that starting point. So you know, targeting people that we know have a need for the service.

Leslie Geller:  OK, so we're coming to the end of our time together. And I asked this of all the women that I interview: You are a woman in a traditionally male-dominated industry, how has that impacted your career trajectory and how you fit in to your firm? And I think you have an interesting take on this, because you transitioned, you made a career transition from, you know, being in public accounting, to this very different industry. And so maybe speak to the transition specifically, because I think that is something very different that you have to add.

Renee Wolgin: I think that I just got to the point where, in recent years, with the changes in the tax laws, and the changes in all of the guidance, and all of the gray areas, I just made a decision years ago that this wasn't my forever. That I knew that there was something different out there for me, where I could really add more value to my clients and be more kind of integrated with them, as opposed to just pushing out a tax return. And while we did a lot of consulting and strategizing, oftentimes, you're so bogged down with the compliance that you really can do as much of that as you want to do. 

As a woman in business, I've always felt very respected by everybody that I've worked with. So I think I'm very fortunate in that regard. And, you know, making a change is always scary. And I felt kind of trapped, and I didn't do it for a long time. And Telemus kind of reached out to me. I've had different relationships with all of those principals in different ways, or through different avenues throughout my life. And we've had many mutual clients. And when they reached out to me, I was, you know, I really was like, “This is it. I think this is the right move for me to make.” And it was scary, and it was hard. But I did it. And it's been so much fun. And I've never looked back. 

As a woman, let's say in the accounting firm, for example, where if you have let's say, divorcees, who maybe were protected spouses and didn't really know anything about their account. We've always had a way of kind of making them feel comfortable. And that you can do this and you're not alone, and empowering them and giving them the tools to kind of be their own advocate, and take control and have a real better understanding of where they are. And so I think that that's always been something that's been appreciated, and respected. And I think that I don't know, clients seem to… we present things in a way where they trust us. And I think that we tell them we're going to do something, and then we actually get it done. And it's just never the woman in business. I've never considered myself a woman in business. I'm just a businessperson who likes to service my clients and do it and strives to do a good job.

Leslie Geller: Thank you so much, Renee. This has been wonderful. This is Renee Wolgin, on PracticeLab podcast. 

Renee Wolgin: Thank you so much. This has been so much fun.

Will McKenna: OK, so that wraps up this episode of the PracticeLab podcast. Special thanks to Renee Wolgin for coming on the show, and thanks also to my colleagues Leslie Geller and Jeff Malbasa.

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