Plumb Welcomes George Logemann as New Chief of Technology Officer

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We are thrilled to share that Plumb has appointed George Logemann as our new Chief Technology Officer (CTO). George joins our team with extensive experience in financial technology and a fresh perspective that will drive our company to greater heights. As a member of our leadership team, George will play a central role in shaping and implementing our technology vision here at Plumb. George will lead software development, focusing on multiple phases of strategic enhancements and innovations, aimed at delivering exceptional value to our clients.

George has three decades of expertise in building financial technology for investment and wealth management enterprises. Notably, George dedicated over 13 years to Citadel, a leading hedge fund in the US. Within Citadel, George held various pivotal roles, including CTO and COO of Global Commodities, overseeing trading and risk technology as well as operational aspects for the firm’s commodities strategies. Prior to this, George spearheaded the creation of Citadel’s firm-wide back office platform, capable of capturing millions of daily transactions and supporting all portfolio management, operations and accounting processing. Beyond Citadel, George has dedicated several years to crafting cloud-based aggregation and operational workflow solutions for the financial advisory sector.

George’s background is broad and deep across financial technology and operations. We anticipate leveraging his leadership and experience at Plumb as we develop our comprehensive technology strategy and deliver top-tier solutions for our clients. “George brings such a cool edge and innovative creative process to our team. I am excited to see how he can expand the app and guide our technology team to new levels,” shared CEO Rob Scherer, expressing enthusiasm and optimism for the future. George has embarked on this mission by beginning to evolve our Plumb Bill Pay App into a comprehensive, interactive financial data platform. This expansion aims to offer clients not only convenience, but also valuable insights and interactive reporting features that empower them to take control of their financial health.

Unlike static reports that provide a fixed set of information, interactive reporting will allow clients to engage with their financial data dynamically. Plumb is using a scalable data warehouse, Snowflake, in tandem with the Plumb Bill Pay Application platform to obtain and pull from client data to offer more robust reporting and significant insights for our clients. Within the enhanced platform, Plumb will enable clients to gain more intuitive access to their information, customize dashboards, visualize trends, predict future cashflows, and receive real-time alerts and recommendations.

By transforming the app into a multifaceted data insights tool, we are not only enhancing its value proposition but also helping users gain a deeper understanding of their finances. This initiative will set a new standard in the fintech industry, demonstrating how technology can be harnessed to provide meaningful and interactive financial insights.

As we embark on this exciting journey, we are confident that George’s vision and expertise will enhance our technological capabilities, foster a culture of innovation, and propel us toward achieving our strategic goals. George shares, “Plumb’s leadership team cares about providing a high-quality client experience and they have outlined an innovative strategy. I am very excited to engage in this endeavor to help shape the future of the application suite and build solutions that will set us apart from other providers.” We look forward to the positive impact George will make and the advancements we will accomplish together. Join us in welcoming George to Team Plumb!

Plumb Placements for 2024 Citywealth Magic Circle Awards

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Plumb is proud to announce that we’ve placed in two categories for the 2024 Citywealth Magic Circle Awards:

  • Technology Innovators of the Year (Winner)
  • UNHW Private Client Services of the Year (Runner Up)

The Magic Circle Awards recognize the accomplishments of professionals and firms working with high-net-worth individuals and families. The awards are presented in London in front of an esteemed audience comprised of over 400 professionals representing over 140 diverse organizations.

Following a rigorous submission process, the submissions are assessed and judged by a panel of private wealth advisors. Online voting is also open to the public, and counts for 10% of the final award vote.

Our proprietary Plumb Bill Pay App is a big reason we have been included in these awards. To learn more about our services and our Plumb Bill Pay App, please watch this brief overview video and reach out to schedule a personal demo.

Plumb delivers financial peace of mind by assisting high-net-worth individuals and family offices know where their money is going, so their trusted advisors can effectively manage it. We work in partnership with their team — including wealth, CPA, and other advisors — to provide the highest quality of data and financial reporting to establish a holistic view of their assets and financial holdings. We’d love to help answer any questions you may have. Feel free to schedule time to speak with Anneke Stender, our EVP, at your convenience.

Digital Wallets and HNWI: Balancing Convenience with Security in Mobile Payments

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For high-net-worth individuals (HNWIs), while convenience and saving time is valued highly, when it comes to managing their finances, security is one of the most important concerns. Digital wallets have emerged as a popular option for mobile payments, offering a blend of both convenience and security. However, for wealthy individuals, the question remains: do digital wallets offer the right balance of these two critical factors?

 

Let’s first define a digital wallet. According to Investopedia, a digital wallet is a financial application that allows you to store funds, make transactions, and track payment histories on devices like phones and tablets. So, think in terms of Apple Pay, Google Pay, CashApp, PayPal, Venmo, and Zelle – to name a few.

 

Digital wallets offer advantages that are particularly appealing to high-net-worth-individuals:

  • They allow users to store multiple payment methods in one secure location, eliminating the need to carry around a bulky wallet full of cards.
  • Payments can be made quickly and easily with just a tap or a click, streamlining the checkout process both online and in-store.
  • Many digital wallets offer features such as loyalty programs and bill pay, further simplifying financial management.

 

Despite the convenience they offer, digital wallets also raise security concerns for HNWIs. Some of these concerns include:

  • Data breaches: If a digital wallet provider is hacked, the financial information of its users could be compromised.
  • Malware: Malicious software can be used to steal data from digital wallets or even take control of them altogether.
  • Loss or theft of devices: If a high-net-worth individual’s phone or other device that stores their digital wallet is lost or stolen, their financial information could be at risk.

 

In light of these concerns, there are a number of steps that can be taken to mitigate the security risks associated with digital wallets:

  • Choose a reputable provider: Use a digital wallet from a well-established company with a strong track record of security.
  • Enable strong authentication: Use strong passwords, PINs, multi-factor authentication (MFA), or even biometric authentication (such as fingerprint or facial recognition) to secure your digital wallet.
  • Keep your software up to date: Make sure your phone and digital wallet app are always up to date with the latest security patches.
  • Monitor your transactions: Regularly review your digital wallet transactions for any suspicious activity.
  • Be cautious about public Wi-Fi: Avoid using public Wi-Fi to access your digital wallet, as this could make it easier for hackers to steal your information.

 

The Future of Digital Wallets for HNWIs

 

As digital wallet technology continues to evolve, we can expect to see even more features and security enhancements designed to address the concerns of HNWIs. However, the bad actors and fraud-perpetrators out there are also becoming more savvy and sophisticated making security vigilance a top priority for high-net-worth individuals and those who help manage their finances.

 

Digital wallets offer a convenient way for HNWIs to manage their finances. By taking appropriate precautions, HNWIs can minimize the risks and enjoy the benefits of this innovative technology.

 

Expense Tracking for Wealthy Individuals: Tools and Strategies for Comprehensive Financial Oversight

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For high-net-worth individuals, managing finances extends beyond simply tracking income and expenses. It’s about gaining comprehensive oversight of a complex financial landscape that may include investments, trusts, real estate, and more. In this context, meticulous expense tracking becomes an essential tool for informed decision-making, optimizing wealth preservation, and achieving financial goals.

 

Let’s start with the basics. Why track expenses?

 

Expense tracking for wealthy individuals offers several unique advantages:

 

  • Identify spending patterns. Track where your money goes, from regular bills to occasional indulgences. This reveals areas for potential cost-cutting or strategic reallocation of funds.
  • Monitor asset performance. Track the specific expenses related to various assets like vacation homes, yachts, or art collections.
  • Inform investment decisions. Understanding spending habits can help to guide investment strategies. If you know how – and how much – is being spent, you can better determine the types of investments you should be making.
  • Catch mistakes before they happen. With exact and itemized expenses, it’s easy to spot something that doesn’t look right.
  • Ensure tax compliance. Accurate expense records are crucial for tax preparation and audits, especially for charitable giving. When expense tracking is set up properly it can help save both time and money with tax preparation.
  • Achieve financial goals. Tracking expenses against set goals, like saving for a second home or philanthropy, keeps you on track.

 

There are also a few effective expense tracking strategies that we suggest to all our high-net-worth clients.

 

  • Set clear goals. Define your financial objectives and tailor your expense tracking to monitor progress towards them.
  • Choose the right tools. Select a tool that aligns with your needs, preferences, and level of financial complexity. For example, the Plumb Bill Pay app is a great tool for providing clarity into finances.
  • Categorize meticulously. Create custom categories to accurately reflect your spending patterns and identify areas for improvement. At Plumb, we create the categories that best suit our clients’ needs so they can see their expenses exactly how they want to see them.
  • Review regularly. Schedule regular time to analyze your spending data and identify trends or areas for adjustments. Plumb provides customized reporting to our clients, as frequently as they need, with as much detail as they want.
  • Seek professional guidance. Consult a financial advisor or wealth manager for personalized recommendations and strategies, and seek outsourced bill payment and accounting support – like the experts at Plumb – to ensure effective management of your expenses.

 

Remember, expense tracking is about gaining valuable insights into your financial behavior, making informed decisions, and ultimately, achieving your long-term financial goals. By embracing effective tracking strategies and utilizing the right tools, wealthy individuals can transform expense management from a chore into a powerful tool for financial empowerment.

 

Take the Next Step Towards Financial Ease and Clarity: Experience the benefits of secure and streamlined expense management. Contact us at sales@thinkplumb.com to discuss how our outsourced bill payment services can enhance accuracy, save time, simplify record-keeping, and reduce stress, and fortify the security of your financial transactions. Your peace of mind is our priority.

Customized Expense Categories for HNWI: Tailoring Reports to Individual Financial Goals

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Beyond Budgeting: How Personalized Expense Categories Empower HNWI Clients

While expense categories are essential for any budget, for high-net-worth individuals with intricate financial lives, customization becomes vital.

At Plumb we understand the unique needs of our high-net-worth clients. We believe that tailored categories can unlock granular tracking, insightful decision-making, and refined budget planning. However, we’ve also seen where excessive detail can have a downside. Too many categories, lacking meaningful insights or tracking benefits, can risk becoming an overwhelming burden.

In this brief article we outline why expense categories matter, the benefits of these categories, and some best practices — and challenges — of implementation.

 

Importance of Expense Categories

  • Track spending: Organizing expenses into different expense categories helps HNWI clients with multiple properties and complex finances track where their money goes.
  • Customization: With QuickBooks class tracking, the clients can see their expenses broken out in whatever way they want and need to see it. This granular categorization might include categories for different properties, children’s school tuition, credit card purchases, country club expenses, or it can be as detailed as individual doctor fees and specific retail stores.
  • Decision-making: Detailed reports based on these customized categories empower clients to make informed financial decisions.

 

Benefits for HNWI Clients

  • Detailed insights: Drilling down into specific expense categories allows for better budget planning and cost control.
  • Control over finances: Clients can see where their money is going and take control of their spending habits.
  • Improved reporting: Customized categories enable clear and accurate financial reports for better analysis. At Plumb, with customized expense categories in place for all clients, we issue reports efficiently and seamlessly – whether they are shared regularly or based on an ad hoc request.

 

Implementation Best Practices and Challenges

  • Standardized Chart of Accounts: This helps maintain consistency across clients while still allowing for customization based on what the client needs.
  • Data overload: Highly customized categories can lead to complex data and reporting challenges. If there’s no benefit to the client, and it’s getting in the way of providing updated and accurate data, we will make the recommendation to the client for a better approach.
  • Matching and accuracy: Ensuring accurate data capture and categorization can be complex with many details. This is where Plumb shines. Our expert bill pay team has the tools and experience to create timely, accurate, and meaningful reports for our clients – regardless of the complexity of the expense categories.

 

With our decades of experience managing the bill payment and expenses of our high-net-worth clients, we understand the best practices of creating customized expense categories: how to create them, how to utilize them to drill down to important information, and how to create valuable and insightful reports.

 

Take the Next Step Towards Financial Ease and Clarity: Experience the benefits of secure and streamlined financial management. Contact us at sales@thinkplumb.com to discuss how our outsourced bill payment services can enhance accuracy, save time, simplify record-keeping, reduce stress, and fortify the security of your financial transactions. Your peace of mind is our priority.

Time is Money: The Power of Bill Payment Apps

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In the fast-paced world of wealth management, even a minor delay can cost high-net-worth individuals and their advisors dearly. Any time not spent on maximizing returns is a missed opportunity.

 

Between managing complex portfolios, navigating the markets, and tending to multiple properties, every minute counts. However, a persistent drain on valuable time often lurks in the shadows: bill payments.

 

Traditionally, bill payment involved manual processes, requiring individuals and advisors to gather bills, write checks, and track payments meticulously. For HNWIs with complex investment holdings, this means dedicating considerable time and resources to monotonous administrative tasks. Moreover, the risk of mistakes and missed payments are ever-present, potentially leading to errors, late fees, and penalties.

 

Enter bill payment apps, which have transformed the landscape by offering intuitive platforms that centralize and automate the entire payment process. These innovative platforms are revolutionizing the way HNWIs and their advisors handle financial obligations, introducing efficiency and automation into a previously cumbersome process. These apps allow users to aggregate bills from various sources, including utilities, credit cards, mortgages, and subscriptions, into a single dashboard. Through secure integrations with bank accounts and financial institutions, bills are automatically retrieved and presented for review, eliminating the need for manual data entry.

 

The Plumb Bill Pay app is the perfect example of a game-changing app, and was developed and built exclusively by Plumb to address the issues and challenges faced by our high-net-worth clients and their advisors.

 

Here’s how bill payment apps, and the Plumb Bill Pay app in particular, save HNWIs and advisors precious hours:

  • Streamlined Workflow: Bill pay apps automatically categorize, prioritize, and schedule bills for payment. This ensures timely settlements without the need for constant oversight, eliminating countless hours spent on paperwork and data reconciliation. Additionally, these apps offer customizable alert systems, notifying users of upcoming due dates, payment confirmations, and unusual activity, thereby enhancing transparency and security.
  • Enhanced Visibility: Gone are the days of scrambling for missing invoices or chasing down overdue payments. Bill payment apps provide real-time visibility into spending patterns and cash flow dynamics, offering personalized insights and recommendations, empowering users to make informed financial decisions. {Read about the Plumb Bill Pay app Commitments module and how it provides clarity and insights.}
  • Reduced Errors: Manual processing is prone to human error. Bill payment apps minimize the risk of mistakes with automated payments, ensuring accuracy and timely payments.
  • Improved Security: Traditional paper-based systems are vulnerable to fraud and theft. Bill payment apps offer robust security measures such as multi-factor authentication and encryption, to safeguard sensitive financial information. {Learn more about just some of the ways Plumb provides the most stringent digital security here.}
  • Advisor Efficiency: For financial advisors, managing bill payments for multiple clients can be a time-consuming burden. Bill payment apps allow advisors to delegate and automate tasks, freeing up their time to focus on strategic financial planning and client relationships.

 

Bill payment apps have emerged as indispensable tools for HNWIs and their advisors, offering unparalleled convenience, efficiency, and security in managing financial transactions. By streamlining the bill payment process, these platforms liberate valuable hours that can be redirected towards more productive endeavors, ultimately empowering individuals to achieve their financial goals with confidence and peace of mind.

 

Family Office Services | FAQ | Plumb Family Office Accounting

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Family Office Services from Plumb Family Office Accounting

Frequently Asked Questions…

The family office services of Plumb Family Office Accounting were developed to help clients navigate through their complex financial life.  By providing personal financial management with consolidated reports and timely bill pay, it gives a clear picture of our client’s wealth and the analysis needed to implement financial, estate and tax planning strategies.

Q:  Is there a minimum net-worth to become a Plumb Family Office Accounting client?

Answer: No. We believe that comprehensive, timely and accurate information gives our clients true control of their wealth, regardless of net-worth.  By getting into the habit of tracking income and expenses, it helps our clients in their wealth creation stage by following a financial plan to accumulate long-term savings and retirement goals.

A typical Plumb client has a net-worth ranging from $10 million to $150 million and sees the value in our service if they have a complex financial life, complete with multifaceted undertakings, such as alternative investments, corporate entities, private equity, international exposure, and collective properties.

Success Stories: Plumb Family Office Accounting Clients

Q:  What is the difference between Plumb Family Office Accounting and a single-family office?

Answer: Plumb Family Office Accounting creates a virtual family office by providing family office services to include personal accounting, bookkeeping and reporting with controller-level insight on a part-time basis or as-needed.

Single-family offices are typically set-up with full-time accounting staff, including a CFO, staff accountants, CPA and a team of attorneys.

By having a virtual or remote family office with Plumb, clients receive the financial data and organizational structure they need without having to hire a full team of advisors on their payroll.  Plumb Family Office Accounting works in conjunction with the trusted advisors of each client and provides financial data to the team to make better estate, tax and financial planning decisions.

Read: Top Ways that Plumb Family Office Accounting works with Trusted Advisors

family office services

Q:  Does Plumb Family Office Accounting manage their client’s wealth or recommend financial strategies?

Answer:  No. We do not advise or manage wealth, do taxes, or financial planning. We prepare comprehensive reports for clients and their advisors to see a holistic view of assets, including the performance of all investments, statement of cash flow, and net-worth statement.

View samples of personal financial reports created by Plumb

Q: What is the pricing structure of family office services by Plumb Family Office Accounting?

Answer: The price varies depending on the complexity of the family’s wealth and reporting needs.  For most clients, we charge a fixed-fee engagement on transaction-based pricing. In order to come up with a pricing structure, we calculate how many bills to be paid, accounts reconciled and the frequency of their reporting needs (monthly, quarterly or annually).

Typically, our clients pay between $2,000 and $4,000 per month for family office services with the minimum engagement being $1,000 per month.  Every client undergoes an annual fee review to see if there have been any changes in the scope of work throughout the year.

Family Bill Pay – Request a Quote

Download: New Client Questionnaire

Q:  Do you provide any other family office services besides personal reporting, accounting and bill pay?

Answer:  Since the majority of our clients lead busy lives, we’ve added outsourced concierge and personal assistant services.  These are customizable based on the family’s need and can range from property management services to booking travel and restaurant reservations, household employee payroll and basic mail pick-up and distribution.  Another example of outsourced concierge is relocation assistance, a project-based engagement in order to help manage and organize a personal move.

See list of outsourced personal assistant services

Q:  Does a client need to be located in Southern California to work with Plumb?

Answer: No, all the financial reporting and bill pay engagements are handled electronically with cloud-based assistance.  Plumb Family Office Accounting uses technology to facilitate bill pay and A/P work flow with a client login system to access reports and status updates.

We offer complete account protection and robust security measures to protect your information from unauthorized access. All confidential information is stored in a data center with multiple levels of security and can only be accessed by Plumb and you or your designated representative. All sensitive information is encrypted and uploaded to your private portal. Two-factor authentication to login to portal further safeguards your accounts and information

Plumb has staff located on both the west coast and east coast time zones to accommodate nationwide and international clients.

Q:  Who is handling the relationship with Plumb Family Office Accounting clients?

Answer:  Plumb takes a team approach for each engagement.  Every client has a main point of contact, a Client Relationship Manager, who oversees a team of junior and senior staff accountants.  The team approach is more cost-effective for the client, as each transaction is mapped in our task management software, and is broken down on a weekly, monthly, quarterly and annual basis.

There is a centralized client communication portal set up via email, so the team has access to client-specific information and requests.  This ensures dependability and consistency if an accountant is out of the office, needs approval or controller-level insight.

Q:  How can I be assured that my financial information is kept confidential and secure?

Answer: Plumb has been in business since 1996 and has a long history of continuity and confidentiality. We are fully bonded and all employees have to pass a background check before they are hired. With every engagement and task, it is handled with the utmost discretion and attention to detail.

We respect the privacy of our Plumb Family Office Accounting clients and take great measures to protect it.  We ensure compliance with best practices and internal control procedures, different levels of approval and password protection.  Our solid system of checks and balances gives our clients reassurance in the integrity and security of their private information and financial data.

Q:  I have a special project that requires assistance on a one-time basis.  Can Plumb Family Office Accounting help?

Answer:  Yes, we can accommodate short-term engagements and project work.  For example, Plumb Family Office Accounting works with divorce attorneys and their clients who are going through a divorce settlement and need help analyzing and tracking expenses to finalize child and alimony support.

Case Study: Divorce Client

Q:  How is the family bill pay set-up?

Answer: We have created a 4-step bill pay process with segregation of duties and different levels of approval.

  1. Client Associate pays bills
  2. Vice President reviews and signs checks
  3. Client Associate reconciles bank account
  4. Client Relationship Manager reviews bank statements

The family bill pay process is first established with the creation of a financial calendar of due dates and vendor information sheet.

View: Family Bill Pay Services: Organize your Financial Life.

Success Stories – Family Bill Pay 

How can you help with organizing for year-end and tax planning purposes?

Answer: We assist our clients to compile the annual tax organizer for their CPA.  Creating this comprehensive, audit-proof package allows to maximize standard deductions, as well as, allows for the CPA to be more cost effective.

Additionally, we provide the CPA with quarterly reports to adjust estimated tax payments as needed to avoid annual penalties and interest charges with the IRS or Franchise Tax Board.

Learn More: Plumb Family Office Accounting Annual Tax Organizer

Are you ready to simplify your financial life and take true control of your wealth?   



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Plumb Bill Pay Implements a Check Fraud Solution with Cheque-Guard

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The Cheque Guard Suite of Products is the Industry-Leading Answer to Combating Check Fraud.

Press Release – Check Fraud Solution for Plumb Bill Pay

Plumb Bill Pay, a premier back-office accounting, financial reporting and bill pay firm for family offices and the high-net-worth, is pleased to announce a partnership with Cheque Guard and their check fraud detection tools and software. The combination of Plumb Bill Pay’s secure cloud infrastructure with state-of-the-art Barracuda Spam Firewall and Cheque Guard’s top-rated check printing security creates a robust defense to protecting client’s financial data.

“As a preferred outsourced bill pay vendor for many top multi-family offices, financial institutions and high-net-worth families, our security concerns around check fraud are a high priority,’ said Anneke Stender, Executive Vice President of Plumb Bill Pay. “After evaluating numerous solutions, we are confident that Cheque Guard is the leader in the industry with their innovative suite of products,” she said.

The Cheque Guard system replaces the need for Plumb Bill Pay to purchase individual checks from financial institutions for clients. Instead, specific account information is imported onto blank checks made with an image-survivable seal that encrypts the data into a barcode. The product is ChequeSeal, a next generation of Positive Pay that requires no issue file or transmission. The ChequeSeal is decrypted and verified at the bank to ensure authenticity of the check.

“Check fraud is the biggest form of payment fraud in the world, and we fully understand the magnitude of the issue,” said Emil Ramzy, President of Cheque Guard. “There is great synergy with the Plumb Bill Pay team and we are happy to partner with them and provide peace of mind that their check writing solutions are safe and secure,” he said.

Plumb Bill Pay offers a range of services, including bill payment, recordkeeping, income and expense tracking, cash flow reporting, vendor management and mail services. These solutions are customizable for every client depending on the need and complexity of their personal financial life.

“Security is at the forefront of Plumb Bill Pay, and we take a proactive approach to ensuring that customer data is not compromised,” said Robert Scherer, President of Plumb. “Cheque Guard gives us the extra layer of protection against the potential vulnerabilities of check fraud,” he said.

Plumb Bill Pay uses a proprietary task management system to facilitate and track bill pay management.  It is hosted on a cloud infrastructure with bank-level security measures and VPN connection. Bills are paid on time, monitored for accuracy and reconciled by a dedicated team. This includes accounting experts who specialize in serving the needs of the high-net-worth.

About Plumb Bill Pay:

For over two decades, Plumb has been helping high-net-worth families, their businesses, and family offices achieve greater levels of personal freedom by handling their personal reporting and bill pay needs.

Plumb Bill Pay works with clients nationwide with office locations in Southern California: 1227 Prospect Street, Suite 200, La Jolla, CA 92037; 16904 Via de Santa Fe, Rancho Santa Fe, CA 92067 and 100 Bayview Circle, Suite 270, Newport Beach, CA 92660 and New York City: 747 Third Avenue, Suite 200, New York, NY 10017  

About Cheque-Guard:

Founded in 1991, Cheque Guard Inc. provides small to medium-size businesses and financial institutions with check fraud solutions, including ChequeSeal™ and ChequeSuite™. These software products allow businesses to integrate and deploy secure, controlled check printing and electronic payments for the Automated Clearing House (ACH), while creating a Positive Pay file for the bank as the checks are printed by the customer.

How to help eliminate check fraud with the protection of Cheque-Guard

This is the next generation of Positive Pay that requires no issue file and no file transmission.  The secure seal by ChequeSeal encrypts the check data into the barcode. When the check enters the banking system, an instant verification goes into action. Before it is paid, ChequeSeal references the encrypted information for comparison and determines the check’s authenticity.  For more information, click here.

check fraud solution

Are you ready to gain financial peace of mind knowing that your bills are being paid on time, reviewed for accuracy and detected from check fraud?



5 Bill Pay & Accounting Tips for Family Offices

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Anneke Stender, Executive Vice President of Plumb and the Founder of the Family Office Accounting and Bill Pay Division of Plumb, discusses bill pay and bookkeeping solutions for family offices.

An overview of Anneke’s background and Plumb Bill Pay

Plumb was founded in 1996 as an outsourced accounting firm for small to medium-sized businesses.

As we developed close and trusted relationships with these privately held businesses, we realized how unorganized some of the business owners were in keeping track of their personal finances. Due to our expertise in accounting and financial reporting, we recognized that we could serve the owners and their families as their outsourced accounting department.

Our family accounting and bill pay services were developed by accounting professionals who have a deep understanding of the unique needs of high-net-worth individuals and family offices. The idea is that we serve as an extension to our client’s family office teams, providing accurate data to all of their advisors so they can make better tax, estate and financial planning decisions.

“By providing high-touch accounting services and technology solutions through our Plumb BillPay app, we act as financial stewards for our Family Office clients in their day to day financial lives. We make sure that their bills are paid on time and their accounting practices are in order, so that our clients can devote more energy to enjoying life and have peace of mind.” – Anneke Stender

1. What are the different ways in which families and family offices pay their bills & handle their finances?

There are three different ways that bills are currently processed within families and family offices:

  1. Dedicated staff such as personal assistants, CFO/Controller or an in house bookkeeper.
  2. CPA firm provides bill pay services in conjunction with their existing accounting services department.
  3. Third-party bill pay provider that specializes in bill pay services, cash management, as well as reporting for families and family offices. These firms typically work in conjunction with the various family office advisors such as their financial planners, CPAs and estate planning attorneys to provide reliable and accurate reporting.

2. What are the 3 advantages to outsourcing Family Office Bill Pay?

It boils down to three advantages to outsourcing the bill pay function within a family office setting:

  1. Families can take advantage of the segregation of duties, including the checks and balances around their bill pay function. What we see here is that most families have one dedicated person handling all steps in the bill pay process. The biggest pain-point third party providers solve here is to alleviate the lack of checks and balances in this process by having a second or even third set of eyes review the transaction before it is released.
  2. Ooutsourced service firms take advantage of the latest technology in their space which helps to automate the process. Frequently, this leads to increased efficiencies and transparencies in the bill pay and approval process for families. For Plumb, this includes a proprietary bill pay technology solution that we have developed in house. Our bill pay workflow process software is an efficient, secure and easy way for our clients to get the right approvals prior to issuing a check or electronic transfer without having to comb through various email communication.
  3. Service firms like Plumb take a white glove or high-touch service approach when working with high-net-worth families and their family offices. This leads to quick turnaround times and the ability to handle last-minute requests, like urgent wires or ACH transfer which can be a big stress relief for families and their advisors. We call this service stance stewardship.

Ultimately, what third-party service providers do for bill pay is to optimize control over the process, bring more scalability, redundancy, precision, and expert oversight into the bill pay and financial organization of families and family offices. As a result this really creates more financial clarity and peace of mind for their clients.

3. What are best practices to optimize Bill Pay for policies, controls and security?

  • The confirmation of wire instructions: Confirm instructions verbally and record these verbal confirmations. If wire instructions have changed, we verbally confirm revised instructions.
  • Centralization of bills: We set up a post office box and a dedicated email address for each client for all incoming invoices which streamlines communication and minimizes loss of bills.
  • A billing tracker is then created to schedule out payments. The billing tracker allows us to proactively reach out if no invoice is received.
  • Segregation of duties: An effective workflow for bill pay should look like this:
    1. Individual receives and enters the vendor invoices.
    2. Second individual will review the transactions to ensure the appropriate
    approvals have been completed.
    3. Third individual will have the authority to sign off on the transaction.
  • Workflow approval application software: Applications provide you with the ability to set approval limits by vendor, dollar amount or entity, as well as integrate with the underlying accounting system to avoid double data entry.

4. How is Plumb Bill Pay integrated with capital calls?

Capital calls and alternatives are an administrative burden for most of our clients.

The Plumb team takes care of the following financial administration tasks:

  1. When a new investment is made, the bill pay system can book the overall commitment, and schedule capital calls.
  2. Team monitors and tracks the remaining commitment.
  3. Verbal confirmation of wire instructions.
  4. Categorization and reconciliation of capital calls and distributions.
  5. Monthly report to the family and its advisors to better manage any upcoming cash and tax planning needs.
  6. Collecting all of the year end K1 statements for the CPA to incorporate with their tax compliance work.

5. How does Plumb Bill Pay allow families to have more clarity over their wealth?

Financial clarity is achieved through integration with existing advisors. Integration with other service providers happens on the reporting side. We link into the various banking and investment portals to obtain the data and categorize them in the underlying accounting system.

Our recommendation around reporting is that:

  • Monthly cashflows should be provided to the family, as well as the financial advisors so they can appropriately plan for future cash reserve needs.
  • Quarterly consolidated financial report is generated which contains a balance sheet, profit and loss, as well as entity financials. The goal here is to provide accurate and reliable data so that other service providers around the family can be more effective from a financial, tax and estate planning perspective. This allows our clients a much clearer and more accurate financial picture.

“Again, the most important take away here is that high net worth families and family offices are looking for ways to simplify their bill pay and bookkeeping needs and doing this in a secure and transparent fashion. They are looking for experts that specialize in their respective area and work well with their existing family advisors. The integration with a third party service provider that is fully integrated with a family office group and their financial advisors can really streamline this process.” – Anneke Stender

Interested in learning more about our services? Contact Anneke today:

Ultra-High-Net-Worth Investor Gains Clarity with Plumb Family CFO Services

Written by

Providing an Entrepreneur with Up-to-Date & Consolidated Financial Data for a Clear Picture of Wealth

Case Study: Ultra-High-Net-Worth Investor & Business Owner

Client:

Ultra-high-net-worth entrepreneur with multiple business investments, rental properties and luxury yacht.

Net-Worth:

$150 Million +

Background:

An entrepreneur who recently sold one of his businesses needed help with his personal accounting, tracking of income, cash flow reporting and bill pay. As he started to invest in additional businesses, he was also looking for an accounting team who could provide him with accurate GAAP compliant financial statements for his new investments.

A snapshot of his financial life included multiple operating businesses, existing holdings, and real estate assets.

Referencing an article in the New York Times, “Inside the Minds of the Ultrawealthy” by Eilene Zimmerman, she asked psychologist Brad Klontz about what it’s like to work with billionaires.

What can the rest of us learn from how the ultra-high-net-worth work through their problems?

The ultra-high-net-worth are not afraid to ask for help. They are more likely to have an internal locus of control, where they are quick to take credit for their successes and admit their failures, at least to themselves. In managing their very complex lives, they have had to rely on a variety of experts to help them along the way. When they run into problems, they are less hesitant than most of us to seek help from someone who is an expert.

Solution & Deliverables:

Plumb Family CFO delivers a customized approach for every client, depending on their needs and complexity of their financial lives.

This Client’s concerns revolved around the accuracy of the data his property management company was providing. He was also seeking accounting assistance for a newly acquired construction business that needed cleaned-up financials and advice moving forward with company performance and strategy.

Personal Reporting & Outsourced Accounting:

  • Create a consolidated trust balance sheet every month
  • Track all transactions and properly allocate
  • Implement calendar of financial due dates for all rental properties to ensure mortgages, property taxes, insurance and utilities are paid on time
  • Work in conjunction with property management firm to receive accurate data
  • Set-up internal controls and accounting procedures to track new business entities, trusts and partnerships
  • Track and consolidate investment funds
  • Reconcile all balance sheet accounts, including Cash, AR, AP and credit card liabilities
  • Project work for establishing up-to-date and accurate financial statements for newly acquired business
  • Maintain yacht slips and make sure invoices are paid on time
  • Ongoing strategic advice on company performance

Outsourced Bill Pay:

  • Forwarding bill statements to client-specific PO Box
  • Sending the Client a comprehensive list of bills for approval of payment
  • Paying bills out of a POA designated bank account
  • Processing checks that Plumb signs as Power of Attorney
  • Performing monthly bank and credit card statement reconciliations
  • Electronically filing invoices to a secured client-specific cloud folder
  • Setting up bill pay schedule with financial calendar of due dates
  • Integrating bill pay schedule into Plumb’s proprietary task management software
  • Implementing vendor management reporting
  • Creating weekly cash flow reports
  • Properly tracking income & expenses

Results – How We Help:

The Client was able to offload many personal accounting and bill pay tasks to Plumb Family CFO. He gained financial clarity and peace of mind knowing that his day-to-day transactions were being handled With consolidated reporting every month, he was able to see a clear picture of his net-worth and had more time to optimize his investment strategies.  With ongoing corporate outsourced accounting and strategic advice on a CFO-level, the Client receives recommendations on industry-specific trends with the companies that he has ownership in.

Ready for financial peace of mind?



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