Broker Check

Episode 83: Navigating the Complexities of Family Wealth: From Family Business to Family Office

In this episode of the Family Biz Show, host Michael Palumbos chats with Kirby Rosplock from Tamarind Learning. They delve into Kirby's extensive background in family businesses and wealth management. Kirby shares her journey from working within her family's multifaceted business to guiding other families through wealth management and legacy planning. She emphasizes the unique challenges and opportunities that come with managing family wealth, especially when transitioning from operating businesses to managing liquid assets.

Kirby discusses the significance of understanding the structure and implications of trusts, a key component in wealth transfer, highlighting that a significant portion of wealth and business interests are transferred this way. She advises families to be mindful of the purpose of their capital and to ensure their investment strategies align with their goals, whether for business continuity, family support, or philanthropy.

Highlighting her work with Tamarind Learning, Kirby showcases how the platform educates beneficiaries and family members on various aspects of wealth management, from understanding financial statements to navigating relationships with advisors. She stresses the importance of purposeful planning and the need for families, especially those with businesses, to consider the interplay between family dynamics, business operations, and wealth management.

The conversation also touches on the critical decision points for families contemplating setting up a family office, including the costs, benefits, and long-term considerations. Kirby underscores the need for families to have clear intentions for their wealth and the structures they put in place to manage it, ensuring they contribute to a smooth and orderly wealth transition across generations.

Watch the entire episode!

Episode 83 Transcript


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Michael Palumbos ChFC, CBEC: Welcome everybody to the family biz show. I am your host, Michael Columbus, with family wealth and legacy in rush to New York.



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Michael Palumbos ChFC, CBEC: and we have a very exciting show for you today with Kirby Ras Block from tamarind learning very excited to have you here, Kirby. Thanks for joining us.



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Kirby Rosplock: Oh, Well, i'm super excited to be here, Michael. Thanks so much.



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Michael Palumbos ChFC, CBEC: You got it. So our kickoff tradition is to ask people to tell their story. What was your journey that got you working in the family business, and you, you know, if I, if I hit.



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Michael Palumbos ChFC, CBEC: get this correctly, you worked in in the family business. And now you run the family business and you serve family businesses along other families, you know. Successful families. Correct. Did I get that right?



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It's a round about kind of way. I will tell you that



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Kirby Rosplock: that our family's business is so far before me, so



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Kirby Rosplock: I oftentimes tell people I won the DNA lottery right? Because I had no idea I would be born into



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Kirby Rosplock: the a multi generational, enterprising family. not with one business, not with 10 businesses, probably with hundreds of businesses over



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Kirby Rosplock: a 100 plus years, so



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Kirby Rosplock: that becomes a very rich back pattern that when you get born into something like that you can't necessarily get your arms around. But



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Kirby Rosplock: my mom's side of the family. Her grandfather, my great grandfather.



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Kirby Rosplock: started a timber company in upstate New York, and then moved the headquarters to Pittsburgh, Pennsylvania.



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Michael Palumbos ChFC, CBEC: and wait a minute. I gotta stop. We're in upstate New York.



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Kirby Rosplock: So



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Michael Palumbos ChFC, CBEC: probably the Schenectity kind of area.



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Kirby Rosplock: So that's I mean literally when I do like, look back at the family fact pattern. That's where they all kind of settle the Babcock plan.



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Kirby Rosplock: and the wonderful thing about



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Kirby Rosplock: first of the family or my side of the family is that they kept really could record. So there's like tremendous genealogy records. And



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Kirby Rosplock: so, you know, I can sort of go we can trace all the way back to when they came over on various votes. And



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Kirby Rosplock: so there's a long, long lineage, Pennsylvania, Dutch, German, and



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Kirby Rosplock: basically Edward, both Fabcock Ev. As he went by.



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Kirby Rosplock: and his brother Fred and Oscar. They timbered from upstate New York



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Kirby Rosplock: all along the eastern seaboard



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Kirby Rosplock: to Miami Florida. So when people say, well, what kinds of businesses did you own? I have to explain Well, to timber back then, there wasn't the 95 corridor that we know today that beautiful highway that runs all along the Eastern seaboard. In fact, that



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Kirby Rosplock: became the 95 quarter because in the late 18 hundreds



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Kirby Rosplock: they bought coke mines, coal mines, and railroads, and literally



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Kirby Rosplock: would lay track, set up a town, 10101520000 acres, Move the next settlers download line



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Kirby Rosplock: and start another partnership and set up the next track line and the next town. And they did that all the way to Miami. So hundreds and hundreds of thousands of acres of land and timber and industry



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Kirby Rosplock: was started way way back then and then



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Kirby Rosplock: over the



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Kirby Rosplock: that, the ensuing decades



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Kirby Rosplock: we diversified so like many family businesses, management consultants came in and said, oh.



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Kirby Rosplock: the best way to maintain your wealth is to diversify so bought up, You know, Agri businesses. We had peanut plantation, sugarcane, property, citrus grows organic farming.



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Kirby Rosplock: and then a whole host of other kinds of different businesses, from hotels to car dealerships, and and lots of other things in between.



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Kirby Rosplock: So I got to set table stakes



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Kirby Rosplock: while growing up so youngest in my family. I I have 2 older siblings. and really sort of got to learn at a distance, like most good inheritors do, by observing, and



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Kirby Rosplock: had a lot of formative memories as a child at the



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Kirby Rosplock: the lumber company picnics and helping run games and events and bingo and



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Kirby Rosplock: competitions like, you know, tug of war and corn, and all this kind of different kind of stuff, and so really grew up



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Kirby Rosplock: feeling connected, but not involved in



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Kirby Rosplock: a lot of the the businesses that that the family owned and managed, and so it wasn't until



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Kirby Rosplock: I moved abroad and lived abroad for a while, and then decided to come back to the United States that I sort of was wondering like, do. I have a place? I remember a very



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Kirby Rosplock: distinct, formative conversation with an uncle of mine.



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Kirby Rosplock: It was like, Well, why would we ever ask you to come into the family business. We have all these other much more qualified family members, and I remember thinking, oh.



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Kirby Rosplock: what do I say to that? And so I responded. Well, that's great, but



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Kirby Rosplock: you know he was mentioning his children. By the way, I was like. But your children are like 20 years older than me, so of course they have a lot more skills and qualifications than I do.



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Kirby Rosplock: and i'm not asking for status. I'm. I would be like low person on the food chain, happy to clean toilets if that was what was required.



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Kirby Rosplock: Nonetheless, I realized very early on in my family that the business was very patriarchal. So women weren't necessarily like, supported and invited and expected



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Kirby Rosplock: to play any kind of role.



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Kirby Rosplock: And so I kind of knew early on that I was probably gonna have to figure something else out. Well fast forward.



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Kirby Rosplock: 2,006 timeframe. My family decided to sell a very large



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Kirby Rosplock: operating entity that probably had 2530 different businesses on it. piece of property, and I knew then that my family was actually going to be dismantling



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Kirby Rosplock: a lot of the shared operating businesses that have been endured for so many years, and at that point is actually, when I got put on the family business board.



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Kirby Rosplock: and I had a day job. At the time I was working in an ria I had built out a lot of skills and acumen.



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Kirby Rosplock: Interestingly enough, it wasn't until myself and my aunt joined the board. We became the first women



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Kirby Rosplock: to represent owners on the board.



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Kirby Rosplock: and that was the first time they decided they should have board requirements for who was allowed to be on the board.



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Kirby Rosplock: So again, I always sort of felt this tension around men and women and ownership and family wealth and family business, and so fast forward. I ended up writing my dissertation on women and wealth, and finished my Phd. In 2,007



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Kirby Rosplock: right around the time I got on the family business board.



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Kirby Rosplock: and that that actually was the the waning years. So I actually was on the board while we were unwinding several different operating companies, selling off and divesting assets, and the best, you know, closing down entities. So it's a really cathartic period



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Kirby Rosplock: to be involved in the family business, because it was an end of an era. Right? It was an end of a very massive era of my



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Kirby Rosplock: my family, and it's business, and then I watch, as my family all became very liquid and very wealthy, and



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Kirby Rosplock: now had to figure out what was next. And so that's part of the journey, and that's part of why, like the books behind me, I ended up writing books on family office and direct investing and everything else.



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Michael Palumbos ChFC, CBEC: Sorry, Michael. That was probably a longer of a story than you anticipated.



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Michael Palumbos ChFC, CBEC: So I some people that are listening to this their first or second generation, and though They've had some, you know, some wonderful success.



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Michael Palumbos ChFC, CBEC: We're not talking about the kind of success that your family has, you know, has encountered.



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Michael Palumbos ChFC, CBEC: so I I want to just unpack that a little bit, If that's okay, because I think it's helpful as we start to talk about. You know where we're going with this, you know this conversation it'll be helpful, for as a frame of reference, and you know some people might listen to this and say, I don't need that right now. But, man, you know, I've got really good friends



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Michael Palumbos ChFC, CBEC: that they gotta be listening to this right now, and you know I want to be able to help with that perspective. So go back. The the business was started. How many years ago?



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Michael Palumbos ChFC, CBEC: 1887. So



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Kirby Rosplock: yeah, to put in perspective my great-grandfather was Mayor Pittsburgh.



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Kirby Rosplock: from 1,918 to 1,922,



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Kirby Rosplock: which was a timeframe of our first pandemic



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Kirby Rosplock: right right



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Kirby Rosplock: a 100 years ago. It's hard to believe this, but we went through what we're going through today, but in a very different scary kind of way, because we didn't know what the Spanish flu was. We didn't know why so many people were dying. We didn't know how it was transmitted.



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Kirby Rosplock: so he he had a lead



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Kirby Rosplock: a city through a really hairy, precarious, devastating. you know, medical catastrophe. So



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Kirby Rosplock: a I mean a lot was going on. So he was involved in politics. He was involved in business. He was really one of those sort of early.



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Michael Palumbos ChFC, CBEC: you know, entrepreneurs of the industrial age.



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Michael Palumbos ChFC, CBEC: There was enough wealth there. There was enough operating businesses that the family controlled many, many, you know, like you said thousands. You know that that that 10 or 15, but hundreds of businesses.



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Michael Palumbos ChFC, CBEC: you had a family board of directors.



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Michael Palumbos ChFC, CBEC: which some people that they never get to the point where we need a family board of directors. So let me let me. Do you know, I know we're gonna have more conversations about this. But why would you need a family board of directors, I I that doesn't make sense to a lot of people as I'm running my very successful, You know I I do 30. I do 80. I do a 100 milliondollars a year of revenue in my business.



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Michael Palumbos ChFC, CBEC: Where where does the Board of Directors come in for the family?



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Kirby Rosplock: So the part of directors, I can't tell you when it first originated, but I know it originated very early on



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Kirby Rosplock: in our families corporate history, and a lot of it was because again, we had a lot of different businesses that were owned, but not always completely owned. Equally



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Kirby Rosplock: so. There was shared ownership across not one branch, but multiple branches, right. If i'm the fourth generation.



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Kirby Rosplock: and



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Kirby Rosplock: Evie has Fred and Oscar as brothers, and he's got lineal owners.



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Kirby Rosplock: So now there's shared owners across different generations, different cousins, distant cousins.



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Kirby Rosplock: and so the board became a really important structure for governance, and oh, ownership, oversight and decision making.



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Kirby Rosplock: and we would have shareholder meetings. So we would bring, you know. family stakeholders together and discuss things in a broader forum.



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Kirby Rosplock: But our board was really responsible for oversight of the management, the leadership, and all these different companies overseeing things like compensation and planning budgeting.



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Kirby Rosplock: So there was finance. There's a lot of different things that the board had oversight on, and so we needed a a family business for fairly early on, because of how ownership got spread.



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Kirby Rosplock: And you know another thing that happens quite frequently in multi generational family businesses is not all family want to remain engaged right? So some families were saying. You know what I kind of want to get out of that entity or that partnership.



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Kirby Rosplock: And so the Board also played a very important role in sort of managing owner interests.



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Kirby Rosplock: and always trying to consolidate, so that, you know there was not, you know, very thin



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Kirby Rosplock: amounts of ownership across 200, 400, whatever number of family members, but keeping, trying to always consolidate ownership around entities to to make it more simplified.



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Michael Palumbos ChFC, CBEC: That makes sense. I had a a that previous guest on the show was Lodge cast iron.



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Michael Palumbos ChFC, CBEC: and they talked about on the show where there was, you know, over 50 family members that all owned



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Michael Palumbos ChFC, CBEC: a piece of the company.



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Michael Palumbos ChFC, CBEC: and they didn't have that family board of directors, or they? They did have the family board of directors, but they didn't have the governance, and they didn't have. You know, some of the other pieces to connect those non family owners to the business, the business head of board of directors. There was no family board of directors that's what it was.



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Michael Palumbos ChFC, CBEC: and so was there. What you're talking about is the family now getting together to talk about? What is this all look like for the future for these different businesses? And how do we guide them?



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Michael Palumbos ChFC, CBEC: That's really interesting. I think that's really helpful for a lot of people to paint the picture to say, oh.



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Michael Palumbos ChFC, CBEC: my business! Now that we have, you know. 10 different operating companies, and we have different ownership levels. And we're in the fifth of the sixth generation, or even the third or the fourth depending on where you're at.



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Michael Palumbos ChFC, CBEC: This might be how we simplify our lives a little bit is the board. The family board of directors, you know.



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Michael Palumbos ChFC, CBEC: helps to organize this stuff, and my gut would say, there's different, you know. Different branches of the family might have somebody that they would put forward to be on that board to represent that different branches.



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Kirby Rosplock: Yeah. So, for example, I was. The whole reason I was put on the board was because my family, like other branches of the family, had provided some additional capital liquidity for certain businesses, and I said we would like



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Kirby Rosplock: a family member to participate on the board on our behalf. and, so truth be told, Michael, I was interviewing Katherine Mccre for the first edition of the Complete Family Office Handbook, and I miss the shareholder meeting. I didn't



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Kirby Rosplock: zoom in or call in virtually. And so, while i'm



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Kirby Rosplock: interviewing Kathryn, my sister is texting me, saying, oh.



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Kirby Rosplock: they're talking about adding board seats. Oh, mom, just as if



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Kirby Rosplock: my brother Chatt or Cricket wanted to be on the board, and they said politely, No, so they said, oh, Kirby Kirby will have to do it, so



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Kirby Rosplock: that that is honestly. The lesson I learned is never be a a show holder meeting, especially when



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Kirby Rosplock: the Board might be



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Kirby Rosplock: under construction, and you end up getting assigned a board to you.



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Michael Palumbos ChFC, CBEC: That's right, quick. Everybody touch their nose and the last one to do it. Oh, Kirby's not here. You're at that's hilarious. Well, thank you for that. I think it's just helpful for many people that have not heard.



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Michael Palumbos ChFC, CBEC: You know about those things before, and as families grow, it's important to understand that there are, you know.



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Michael Palumbos ChFC, CBEC: our ways of doing this that have been done before you already



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Michael Palumbos ChFC, CBEC: interesting, interesting. So talk about.



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Michael Palumbos ChFC, CBEC: I know how the businesses made money



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Michael Palumbos ChFC, CBEC: in the past. And



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Michael Palumbos ChFC, CBEC: what do you do today?



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Kirby Rosplock: Yeah.



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Kirby Rosplock: So now that we don't have operating entities. Right? Individual family members have set up family offices. Some have decided to manage their wealth through outsource cios, others have



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Kirby Rosplock: decided to go work and be clients of multi-family offices, and some are what I call do it yourselfers who kind of might have a quasi or a virtual office or kind of a hybrid office, where they have one or 2 staff members dedicated to them. But then



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Kirby Rosplock: the investment management, their State planning, trust and tax work is all outsourced to third parties that the one or 2 people inside their office oversee.



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Kirby Rosplock: So now my family is largely liquid. But I say that with the caveat that now inheritors and successors, myself included, are extraordinarily entrepreneurial.



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Kirby Rosplock: So



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Kirby Rosplock: you know, I would say I have one. Custin, who has built a pretty massive fashion design maternity wear company that Kate Middleton and several other folks have picked up on, and she's wildly successful.



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Kirby Rosplock: I have a sister who has her own business and at her own art conservation business.



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Kirby Rosplock: I have 2 businesses, and we both my husband and I both work in tamarin partners, Our consulting firm for family offices, and Tam and learning our educational technology business for inheritors, successors, trustees, and advisors. So



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Kirby Rosplock: it's interesting how once our family went from being bound by corporate stock, and you know, once those ties that bound us together that closely held this closely held securities



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Kirby Rosplock: that now there's been sort of a Renaissance and a rebirth, and there's there's a lot of family members who have ranches. I have a cousin, if you've ever heard of the moon pie, so that's one of my cousins



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Kirby Rosplock: who started the the whole Moon Pie Company in Tennessee. So there's a lot of different businesses that have spun out. Some are sort of family oriented. Some are not so much so.



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Kirby Rosplock: It's. It's all all different for all different branches of the family.



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Michael Palumbos ChFC, CBEC: That's interesting, so that it brings up a really interesting point



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Michael Palumbos ChFC, CBEC: just in your family alone. There's no one right way to when we have a liquidity event, you know. We we try to, you know, share with people it. It's really hard for most of America to understand what you're talking about, and and and and the reason why I because we're on a such a broad platform. I want to make sure that we that we get that.



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Michael Palumbos ChFC, CBEC: I think the number today is somewhere around 17 million dollars and 17 million dollars and below put you, You know, something up above 17 million. You're in the top quarter of one of America, and I don't have it exact.



00:19:50.320 --> 00:20:00.920

Michael Palumbos ChFC, CBEC: but it's data from the census Bureau does these things on a pretty regular basis. 88 of America has a net worth under a 1 million dollars.



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Michael Palumbos ChFC, CBEC: And so you know, when when you get above that 17 million dollars and you start going into the 50 and a 100 million 250 milliondollars, there's just different levels of services available, because the complexity of managing all of that money becomes



00:20:19.260 --> 00:20:20.690

Michael Palumbos ChFC, CBEC: got a job.



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Michael Palumbos ChFC, CBEC: You could be managing money, and the estate and the taxes and all that stuff as a full time job. And that's why there are family offices, and why people create them? Because



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Michael Palumbos ChFC, CBEC: you know, it's a lot.



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Michael Palumbos ChFC, CBEC: I I you know, for one, I would consider myself to be an outsourced family office. When we do that work and we do it. We do it for family owned businesses, because



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Michael Palumbos ChFC, CBEC: we're this specialty company that we help them with their strategy and their people issues and culture. And so we do the business coaching as well as a state and investments and



00:21:00.780 --> 00:21:02.430

Michael Palumbos ChFC, CBEC: personal financial planning.



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Michael Palumbos ChFC, CBEC: It's really interesting to have seen all of the different. Everybody in the family doing something different.



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Kirby Rosplock: Yeah.



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Michael Palumbos ChFC, CBEC: I love that. So you have tamarin partners



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Michael Palumbos ChFC, CBEC: and tamarin learning. And why were they created? Where did they come from?



00:21:23.710 --> 00:21:28.250

Kirby Rosplock: Yeah. So 10 years working in a multi-family office.



00:21:28.690 --> 00:21:32.110

Kirby Rosplock: and I realized



00:21:32.830 --> 00:21:38.940

Kirby Rosplock: that I was done like I was sort of done working in corporate America like



00:21:39.070 --> 00:21:51.050

Kirby Rosplock: I was not incented by the hierarchy or climbing the ladder. And I realized very clearly, too, because I you know, I've worked in the wealth management and the financial services for 20 years, and I realized



00:21:51.060 --> 00:21:55.090

Kirby Rosplock: gosh, I'm really not motivated by money like



00:21:55.180 --> 00:22:06.010

Kirby Rosplock: I don't really care how many zeros are behind my name. I care about my contribution. I I care about knowledge, creation. I care about



00:22:06.300 --> 00:22:20.320

Kirby Rosplock: creativity and inventing new things. And so. as you probably know, corporate America is not the most inspiring place for filling that cup that I was looking for.



00:22:20.380 --> 00:22:26.400

Kirby Rosplock: and you know I I felt like you know what I put in a 10, almost 10 years of my life



00:22:26.620 --> 00:22:32.020

Kirby Rosplock: into a very like reg regimented 9 to 5



00:22:32.120 --> 00:22:35.290

Kirby Rosplock: wealth management job, and



00:22:35.650 --> 00:22:42.250

Kirby Rosplock: I was ready, and so I had helped write a book internally at the company.



00:22:42.300 --> 00:22:56.030

Kirby Rosplock: and Jay Hughes was part of that book experience. And I, said, jay, I think I have some other book ideas. What do you think? And he said, Well, I think you should talk to Bloomberg Press, which subsequently got acquired by Wiley.



00:22:56.110 --> 00:23:00.820

Kirby Rosplock: So I pitched some ideas to Wiley, and they said great.



00:23:00.880 --> 00:23:19.310

Kirby Rosplock: So I went and wrote the book, and I took an unpaid leave of absence from my day job. And quite honestly, when I came back I realized that it was time for me to go, but it was just too much to try to integrate. Now this whole independent book project the company signed off on.



00:23:19.420 --> 00:23:33.470

Kirby Rosplock: and to stay where I was. So I made the leap, and I left at the end of 2,013, not really sure what I was going to do, but I just knew I was releasing this book in 2,014.



00:23:33.900 --> 00:23:43.450

Kirby Rosplock: And, Michael, you can imagine how happy compliance was that I was leaving because I was the biggest pain in their backside



00:23:43.500 --> 00:23:46.310

Kirby Rosplock: for outside business activities, because



00:23:46.470 --> 00:23:58.740

Kirby Rosplock: meanwhile, in the back noise I still had other company interest. I was being asked to sit on other people's boards, so I had a lot of outside involvement in other extracurriculars



00:23:58.760 --> 00:24:12.580

Kirby Rosplock: that we're just constantly frustrating to the firm I worked for. So that's essentially how Cameron partners got started, not because I thought it was creating a consulting firm, but because I was sort of



00:24:12.800 --> 00:24:23.620

Kirby Rosplock: closing up, leaving my institutional day job and wrote a book, and then then the phone started ringing, and then I didn't really know



00:24:23.680 --> 00:24:38.190

Kirby Rosplock: what I was selling because I wasn't really selling anything. I just thought, you know. I bet you people would want to know really good objective advice that was not tied to product, not tied to investment advice.



00:24:38.290 --> 00:24:40.890

Kirby Rosplock: It was really an independent.



00:24:41.040 --> 00:24:50.800

Kirby Rosplock: and that was my like thesis of a consulting job. And here I am, you know, 10 years later, and it at proofed out, and by



00:24:50.890 --> 00:24:59.290

Kirby Rosplock: 3 years into my consulting work. not knowing what I was going to be consulting on per se exactly family office. Obviously



00:24:59.320 --> 00:25:05.350

Kirby Rosplock: I realized the net worth of just the 3 or 4 families that I was working with



00:25:05.570 --> 00:25:13.000

Kirby Rosplock: was larger than the network of all the 300 plus families I worked with, combined at Jen Spring.



00:25:13.890 --> 00:25:17.220

Kirby Rosplock: So all of a sudden there was this moment of like.



00:25:17.520 --> 00:25:20.310

Kirby Rosplock: Okay, now I've just sort of leveled up.



00:25:22.270 --> 00:25:26.210

Kirby Rosplock: and I felt like that beautiful beginner mind again, of



00:25:26.300 --> 00:25:38.970

Kirby Rosplock: kind of rediscovering. How complex and how interesting and how fascinating! And I think another thing you and I share is that a lot of the families that reached out to me tended to be more operating



00:25:39.170 --> 00:25:40.970

Kirby Rosplock: an orientation.



00:25:41.500 --> 00:25:53.080

Kirby Rosplock: so they weren't necessarily fully liquid. but they had multi-generational ownership interest, and then they also had to have a lot of very complicated



00:25:53.230 --> 00:25:58.680

Kirby Rosplock: estate planning trust and tax planning that was thoughtful



00:25:58.760 --> 00:26:11.680

Kirby Rosplock: and prudent, and had to take into effect a lot of different jurisdictions. So i'm not an attorney. I don't give legal advice, but it was great for them to be able to have someone with



00:26:11.680 --> 00:26:23.450

Kirby Rosplock: knowledge, review certain materials and opine and say, what about this? So just to kind of keep the advisors that they were all working with. I won't say honest, but knowing that that they weren't



00:26:23.860 --> 00:26:25.420

Kirby Rosplock: doing stuff in the back you



00:26:25.490 --> 00:26:26.100




00:26:26.260 --> 00:26:29.900

Michael Palumbos ChFC, CBEC: it's it's such a great Guy, my one of my favorites.



00:26:30.140 --> 00:26:49.260

Michael Palumbos ChFC, CBEC: knowing that they're not doing work in a vacuum. I tell all the families that I serve that it is minimum once a year. And and again i'm not serving families, the at the size that you're talking about. Okay, my families are, you know, 40, you know, 20 million to a 100 milliondollars.



00:26:49.270 --> 00:26:53.490

Michael Palumbos ChFC, CBEC: A lot of them would fit inside a Jen spring.



00:26:53.580 --> 00:26:57.760

Michael Palumbos ChFC, CBEC: And but when you get to that level of wealth



00:26:57.930 --> 00:27:14.830

Michael Palumbos ChFC, CBEC: there is a lot of complexity. There are trust. There's insurance there's there's Llc's and S. Corpse, and there's a lot of different things going on, and every single time that the attorney that pushes a button or the account, and pushes a button, or the wealth manager pushes a button.



00:27:15.930 --> 00:27:23.690

Michael Palumbos ChFC, CBEC: It. There's an effect that's there's you know, shack waves in that different areas. And you need to understand



00:27:23.750 --> 00:27:31.010

Michael Palumbos ChFC, CBEC: all of those things, you know, and that's without even putting philanthropy into the into the mix of things.



00:27:31.280 --> 00:27:31.890

Kirby Rosplock: Yeah.



00:27:32.370 --> 00:27:37.520

Michael Palumbos ChFC, CBEC: So you and I met through an organization called the Purposeful Planning Institute.



00:27:37.620 --> 00:27:45.530

Michael Palumbos ChFC, CBEC: and I met Jay Hughes Jay was just on my show. We recorded 2 episodes. I'm. Really excited to have him come out.



00:27:45.930 --> 00:28:04.720

Michael Palumbos ChFC, CBEC: That so exactly. It sounds like the same reason, which is, we're trying to better serve the families that we're involved with, and so surrounding ourselves with people like J. You like John a. Warnick and all the others. It it's just



00:28:04.720 --> 00:28:09.520

Michael Palumbos ChFC, CBEC: it keeps you grounded. It keeps you reminding why we're doing what we're doing. Right?



00:28:09.650 --> 00:28:10.410

Kirby Rosplock: Yeah.



00:28:13.250 --> 00:28:23.100

Michael Palumbos ChFC, CBEC: I I I love what you're doing. So you went through my family. We had a family office. We did all these things. I was on the family board of directors.



00:28:23.300 --> 00:28:25.190

Michael Palumbos ChFC, CBEC: and



00:28:25.200 --> 00:28:30.400

Michael Palumbos ChFC, CBEC: you, you tell reminder you so. You have several books today. But what was the first one?



00:28:32.240 --> 00:28:48.830

Kirby Rosplock: So the very, very first one was inside of Jen Spring, and that wasn't a commercial book. But it was a thought leaders guide to family wealth, and J. Hughes as one of the key thought leaders that had inspired and influenced



00:28:49.030 --> 00:28:53.290

Kirby Rosplock: Ha Perry, who founded Jen's spring. and



00:28:54.440 --> 00:29:07.960

Kirby Rosplock: after that this first independent book I wrote was a complete family office handbook, and it's sort of the this one right here. So I was the first one, and then they all kind of look similar after that. But



00:29:07.990 --> 00:29:13.670

Kirby Rosplock: but then I wrote a direct investing handbook, because I realized



00:29:13.910 --> 00:29:28.920

Kirby Rosplock: in my family, like so many other families that there's like one core business that generated a lot of wealth. And then we invested in all these other businesses where we started all these other businesses. And there's one thing to be



00:29:28.920 --> 00:29:38.580

Kirby Rosplock: an active engaged owner, and it's another thing to be a direct investor, investing into privately held or closely held businesses. And so.



00:29:39.130 --> 00:29:51.960

Kirby Rosplock: you know there's a joke that's something like, you know, a good way to take an extraordinarily large portion and make it much more manageable is to invest in direct investments.



00:29:52.020 --> 00:30:11.680

Kirby Rosplock: Why? Because a lot of people Don't, recognize the following capital required the intensity to be engaged as an owner of a direct investment, the time, the energy, and the duration right? It's a long time to own something that may or may not work out



00:30:12.030 --> 00:30:18.440

Kirby Rosplock: depending on where you get in. Are you at seed Angel stage, or you at me like later stage? So



00:30:19.460 --> 00:30:22.330

Kirby Rosplock: so I wrote that book, and then I, just in



00:30:22.390 --> 00:30:35.960

Kirby Rosplock: at the end of 2,021 release the second edition of the Complete Family Office Handbook. So these 2 are actually Brother and Sister I Don't know which one goes first, but the the red addition now is the second edition.



00:30:36.100 --> 00:30:47.560

Kirby Rosplock: so and it about 80 85% revised. So I I scrubbed a lot of data that was dated, and I add, like a bunch of new pieces. So



00:30:47.590 --> 00:30:48.310

Kirby Rosplock: yeah.



00:30:48.490 --> 00:30:53.110

Michael Palumbos ChFC, CBEC: So basically. this is your life experience



00:30:53.250 --> 00:31:09.080

Michael Palumbos ChFC, CBEC: being part of a family business winding down those family businesses, being on the family board, seeing and running the family office, and then working in a multi family office for years. So you have personal background



00:31:09.130 --> 00:31:12.700

Michael Palumbos ChFC, CBEC: and and what you wish somebody had taught you.



00:31:14.140 --> 00:31:18.610

Michael Palumbos ChFC, CBEC: plus all the things that you learned in what you've been teaching other people for many, many years.



00:31:19.100 --> 00:31:22.140

Kirby Rosplock: Yeah. And the handbooks are really like.



00:31:22.240 --> 00:31:40.570

Kirby Rosplock: you know, Typical Handbook, which I don't know. All things tax or all things state planning, or all things legal structure. So where I don't have the expertise, we have great thought leaders who come in and written bespoke chapters on sort of all the different areas of family office



00:31:40.570 --> 00:31:45.570

Kirby Rosplock: I I wrote about, I would say 60 of both of the handbooks.



00:31:45.620 --> 00:32:00.100

Kirby Rosplock: and, thanks to Wiley, they had me cut it down to, I think about 450 pages. So it's it's a it's a heavy book, I I can tell you, because i'm a sherpa of books, and it weighs just about £5. So



00:32:00.220 --> 00:32:04.870

Kirby Rosplock: you know a lot of what's in the book is actually not my story.



00:32:04.990 --> 00:32:14.580

Kirby Rosplock: because of my family, right when when you're connected to a family. You're intensely private and quiet, and and so



00:32:14.720 --> 00:32:28.620

Kirby Rosplock: maybe if I take a pen name and it shows up in the succession like series, you know, maybe down the road you'll because certainly my family was not perfect, like most multi-generational families. So



00:32:29.000 --> 00:32:40.190

Kirby Rosplock: but for right now all of the work that you see behind me is research, primarily from other families, other family businesses, other family offices and institutional data.



00:32:40.970 --> 00:32:44.400

Michael Palumbos ChFC, CBEC: So when we look at tamarin learning



00:32:44.940 --> 00:32:46.700

Michael Palumbos ChFC, CBEC: what is your



00:32:47.790 --> 00:32:59.020

Michael Palumbos ChFC, CBEC: platform. And what is, Why do you exist? And what do you bring to the world with Tamarin learning



00:33:00.220 --> 00:33:05.680

Kirby Rosplock: about? Gosh! 8 or 9 years ago, and, Interestingly enough, I just



00:33:05.770 --> 00:33:11.000

Kirby Rosplock: was able to connect with one of the next Gen. Members



00:33:11.010 --> 00:33:13.790

Kirby Rosplock: that influence and inspired chairman learning.



00:33:14.330 --> 00:33:26.000

Kirby Rosplock: There are 2 families, different families, different engagements. But the first family we worked with and mentored 3 young adult women sisters



00:33:26.720 --> 00:33:32.980

Kirby Rosplock: as they sort of built more acumen and awareness around what they were going to inherit



00:33:33.000 --> 00:33:48.090

Kirby Rosplock: what their financial lives look like, what they need to think about working with their advisors, what their trust said. How do we? An investment statement how to read their financial statements. So we wanted to put the floor of basic



00:33:48.520 --> 00:33:57.230

Kirby Rosplock: financial literacy in, so to speak. and none of these women had a financial background, so they none of them studied



00:33:57.280 --> 00:34:02.610

Kirby Rosplock: business or econ, or finance, or anything like that. They were more on the



00:34:02.850 --> 00:34:08.780

Kirby Rosplock: classic. I'll call it bachelors of our, you know, creative



00:34:08.900 --> 00:34:15.239

Kirby Rosplock: music, dance literature. So long. Story short.



00:34:15.420 --> 00:34:22.150

Kirby Rosplock: we did a very customized learning path for each one of them, and then, as a sibling team. We had stuff that overlapped.



00:34:22.320 --> 00:34:33.770

Kirby Rosplock: and that was really really rewarding and successful. And we love doing that kind of work. But we realized we could only do that kind of work with so many families, 1 one by one.



00:34:34.150 --> 00:34:51.710

Kirby Rosplock: fast forward to another family engagement, and that was around circuit 2,017, 2,018 long story short, there the family was really really complicated, and it was a blended family that lots of entities, lots of partnerships, many, many operating entities.



00:34:51.710 --> 00:34:58.440

Kirby Rosplock: and a huge dispersion of awareness, knowledge, and involvement, and



00:34:58.510 --> 00:35:01.290

Kirby Rosplock: one or one of those entities



00:35:01.440 --> 00:35:13.330

Kirby Rosplock: and we recognize that they also lived in 27 million different places, and they like to travel all the time, so there was no way. We are going to be able to one off educate each one of them.



00:35:13.470 --> 00:35:18.460

Kirby Rosplock: So we built a bespoke learning management system for their family.



00:35:18.850 --> 00:35:33.810

Kirby Rosplock: and we rapid prototype, built it out. We hired our team, hired instructional designers from Harvard, I mean. It was a huge lot left incredible left to do this work super rewarding.



00:35:33.900 --> 00:35:36.320

Kirby Rosplock: But in that experience we realized.



00:35:36.450 --> 00:35:48.280

Kirby Rosplock: you know what this is not going to be a scalable business that we built one off, one off, one off, right? So we said, Well, what can we learn from this and potentially build



00:35:48.310 --> 00:36:00.600

Kirby Rosplock: 2 of what we did for this family. So that's essentially how Tamarin learning came to be launched in 2,020 end of 2,020, and we actually



00:36:00.730 --> 00:36:11.340

Kirby Rosplock: grew out of the technology we originally were using. So we actually built our technology as well as the content. So that's that's pretty meaningful, because



00:36:11.650 --> 00:36:16.500

Kirby Rosplock: there's a lot of incredible learning management system software out there.



00:36:16.640 --> 00:36:23.170

Kirby Rosplock: But ours is one of the few that real time we can real time edit content. We can real time



00:36:23.220 --> 00:36:38.500

Kirby Rosplock: change up and share things. If we see something. We don't have to go to some development site in Indonesia or India, or wherever and that's no dis on those bigger companies that have those massive



00:36:38.720 --> 00:36:46.080

Kirby Rosplock: programmer sites up, you know, out of countries, but we like to be able to control everything at at the tip of our finger.



00:36:46.870 --> 00:36:50.710

Michael Palumbos ChFC, CBEC: So what kind of things can a family learn?



00:36:50.790 --> 00:37:02.210

Michael Palumbos ChFC, CBEC: You know I I I just wanna I I know you mentioned a few of them, but let's just talk about it again, you know we. So there's investment statement, reading what else you know. What are some of the things that



00:37:02.870 --> 00:37:10.060

Michael Palumbos ChFC, CBEC: people come back to you and said, oh, my goodness! I would have never thought to ask you about this, but I'm: so glad you taught me. Yeah.



00:37:10.570 --> 00:37:19.170

Kirby Rosplock: So here's sort of a crazy number. It's something like 80% of well, and business interests are transferred in trust.



00:37:19.330 --> 00:37:34.120

Kirby Rosplock: And why do I bring this up? Because we are oftentimes not educated about what that construct really means? If you're a beneficiary or the role of your trustee, or the intention of the grant, or



00:37:34.200 --> 00:37:39.630

Kirby Rosplock: or if you're in Canada, we call you the set lower. And so, all of a sudden.



00:37:39.710 --> 00:37:45.040

Kirby Rosplock: we think we know a lot about what our family does and our business entities, and everything else.



00:37:45.520 --> 00:37:52.190

Kirby Rosplock: But for many inheritors and beneficiaries, they're not really clear about the structure



00:37:52.250 --> 00:37:59.830

Kirby Rosplock: and how it operates, and how to read those legal documents, or what's my role and responsibility as a beneficiary.



00:37:59.850 --> 00:38:03.730

Kirby Rosplock: or what does my trustee really have to do or not do.



00:38:05.240 --> 00:38:08.860

Kirby Rosplock: How do I know? I know he or she is doing a good job?



00:38:09.070 --> 00:38:26.560

Kirby Rosplock: And so we built the the whole learning program with the idea that what if we started from this basis of the trustee beneficial relationship, the concept of stewardship and built into technical areas such as estate planning.



00:38:26.580 --> 00:38:28.760

Kirby Rosplock: trust tax.



00:38:28.840 --> 00:38:45.780

Kirby Rosplock: And then further building on that looking at financial planning. And that's those personal financial planning, budgeting to understanding corporate financial statements. So how do you read a balance sheet. What's the difference between income statement and a net worth statement



00:38:45.840 --> 00:39:01.010

Kirby Rosplock: to now working with advisors? So I think we're the first platform or program. I've seen that actually has. Course we're dedicated to. Do you know how your investment advisor gets paid versus your accountant?



00:39:01.100 --> 00:39:03.680

Kirby Rosplock: Do you understand how to fire



00:39:03.860 --> 00:39:19.340

Kirby Rosplock: an advisor. If you're in that, you need to be in that situation. So we provide guidance and education around understanding these working relationships. And yes, we also cover investing as well. But again we don't



00:39:19.690 --> 00:39:33.890

Kirby Rosplock: lean towards like, what is the stock? What is the bond? I mean? We have that information in our system, but we probably lean more towards. Do you have an ips? Do you know what an investment policy statement or an Ips is?



00:39:33.910 --> 00:39:47.920

Kirby Rosplock: Do you know the components? What goes into an Ips, and why or investment governance and the role of the investment committee. So we we probably go to a higher level of



00:39:47.990 --> 00:39:59.790

Kirby Rosplock: investment acumen that again is very bespoke. But all of our learning is actionable and applied. So it's things that really beneficiaries are facing.



00:39:59.830 --> 00:40:11.320

Kirby Rosplock: you know, like do I move to a different state if it has higher taxes and higher cost of living. And how do I think about the tax trade versus maybe the income I might make in a new role.



00:40:12.550 --> 00:40:13.480

Michael Palumbos ChFC, CBEC: Awesome.



00:40:13.660 --> 00:40:18.380

Michael Palumbos ChFC, CBEC: It's fabulous that you undertook that and did that it's



00:40:18.540 --> 00:40:22.770

Michael Palumbos ChFC, CBEC: we we we must have like a kindred spirit between the 2 of us



00:40:23.170 --> 00:40:35.760

Michael Palumbos ChFC, CBEC: people ask me, what is a wealth manager that has been serving family businesses doing coaching businesses? What right do you have to do that, and it it's very similar. Somebody said to me.



00:40:36.170 --> 00:40:38.250

Michael Palumbos ChFC, CBEC: what fed 3 families



00:40:39.280 --> 00:40:40.930

Michael Palumbos ChFC, CBEC: is not going to be able to feed 8,



00:40:41.340 --> 00:40:52.710

Michael Palumbos ChFC, CBEC: and so, when they were going from generation to generation 3. There was going to be a big giant in order to have the same lifestyle. They're going to have to do grow the revenue and scale the business.



00:40:52.880 --> 00:40:58.230

Michael Palumbos ChFC, CBEC: and I just thought that was such an interesting question



00:40:58.360 --> 00:41:14.060

Michael Palumbos ChFC, CBEC: that I went out and trained myself to. You know I found the different coaching programs and studied them and looked at them. I read hundreds of books, and and just said i'm and I that that part of my business.



00:41:14.200 --> 00:41:21.010

Michael Palumbos ChFC, CBEC: Don't tell anybody I know this. I know this, Isn't reported. No, I in my favorite part of the business now is the is the business coaching



00:41:21.040 --> 00:41:36.040

Michael Palumbos ChFC, CBEC: and and really helping them to grow the asset. That was the thing that got them where they were in the first place, and to really help them with those things. And then, when I can wrap in the other pieces of the you know the wealth, management side of things.



00:41:36.520 --> 00:41:43.340

Michael Palumbos ChFC, CBEC: Think about that. We we were talking about trust before we're gonna about to talk about scaling the business and growing it



00:41:43.340 --> 00:42:00.800

Michael Palumbos ChFC, CBEC: 2 X. And if you've already got an estate tax problem, then are you grow? Why not grow it inside of a trust instead of outside of a trust? And why are we doing the things that we're doing? But now, as i'm doing that, Kirby, you and I are going to have to have a closer relationship because they're going to be people that we're going to have to train to say.



00:42:00.800 --> 00:42:12.170

Michael Palumbos ChFC, CBEC: Let me explain to you why this trust. Let me explain to you how the the roles work, and you know why this trust is in South Dakota instead of New York, or whatever the root things are.



00:42:12.220 --> 00:42:17.240

Michael Palumbos ChFC, CBEC: Yeah, that's really super helpful, because I i'm going to tell you



00:42:17.340 --> 00:42:25.850

Michael Palumbos ChFC, CBEC: i'm pretty done good. I i'm! I'm proud of what my father taught me before me, and all of my mentors in the work that I've done.



00:42:26.680 --> 00:42:37.980

Michael Palumbos ChFC, CBEC: I don't take enough time to train and teach. because that's not. You know the the next generation. And so you know I I do tell them you can ask me anything



00:42:38.670 --> 00:42:50.550

Michael Palumbos ChFC, CBEC: here, I will. I will help you, and there are no dumb questions even as even to the point of let's take some time to go through the statement. But to put curriculum together, I don't have that.



00:42:50.850 --> 00:43:04.570

Kirby Rosplock: Yeah, Well, listen. You don't have to have that. Can I say that honestly because we built our platform to welcome advisors like yourself and others. We say I have a day job. I like 50 other things i'm doing.



00:43:04.600 --> 00:43:09.630

Kirby Rosplock: But if I had a curriculum that could support my. You know



00:43:09.760 --> 00:43:24.810

Kirby Rosplock: my clients or my clients, or whatever. Yeah, and that's what you. That's why you exist today.



00:43:25.020 --> 00:43:40.200

Kirby Rosplock: People can actually you'd be amazed. I think there's more evidence now to to support that self study is growing lead to bounds, thanks to the pandemic. But the reality is, there's this generation of



00:43:40.260 --> 00:43:53.370

Kirby Rosplock: millennials, and up and comers are pretty geared at like they go and find what they want, and they do it. And then they those that want additional support and mentoring either of who they want that mentoring to come from.



00:43:53.430 --> 00:43:56.320

Kirby Rosplock: or they already have, like a system.



00:43:56.830 --> 00:44:02.310

Kirby Rosplock: or they they have resources to find the right folks. What we're excited about is that



00:44:02.320 --> 00:44:25.160

Kirby Rosplock: we feel like we have a great amount of data and information that's really organized smartly and intuitively. so you can find it. You can go through linearly through our progression, or if you're like, I'm. Looking for this or looking for that, we have search features. We have a lot of ways to make it accessible and fun. We have learning checks, we have quizzes, we have games.



00:44:25.160 --> 00:44:30.740

Kirby Rosplock: we have activities. So it's not just online. It's it's multimodal



00:44:31.210 --> 00:44:32.120

Michael Palumbos ChFC, CBEC: love it



00:44:32.420 --> 00:44:39.040

Michael Palumbos ChFC, CBEC: So you should not a lot to be proud of. That's a that's a a pretty hefty accomplishment. Nice job!



00:44:39.110 --> 00:44:45.140

Kirby Rosplock: Oh, it's the get that keeps on giving Michael because it's honestly never done, and.



00:44:45.180 --> 00:44:47.540

Kirby Rosplock: thanks to you know



00:44:47.640 --> 00:44:55.520

Kirby Rosplock: everything that happens on it almost daily basis we we can update and add new content, new curriculum, be it



00:44:55.530 --> 00:45:10.160

Kirby Rosplock: crypto, currency, debacle, and what can we learn right from that whole ftx debacle to. You know. What can we learn from what happened in our banking and regulatory environment recently



00:45:10.160 --> 00:45:27.350

Kirby Rosplock: with Silicon Valley Bank? So there's this. There's a lot of opportunity that we like to leverage with real time examples and cases. So we have anonymized cases. But we actually have a lot of stories of real people, real families that's based off of what's publicly available.



00:45:27.600 --> 00:45:28.290

Michael Palumbos ChFC, CBEC: Okay.



00:45:28.800 --> 00:45:38.950

Michael Palumbos ChFC, CBEC: Yeah. I was just on a recording a show a little while ago and talking about Tony Shea, the founder of Zappos, and it was like, you know.



00:45:38.970 --> 00:45:55.490

Michael Palumbos ChFC, CBEC: great job of building culture and doing some wonderful things about building a business, no estate plan, and we, you know. So it's, and that's all publicly public information. And so yes, there's tons of examples of Why are we doing what we're doing? And it's important to learn.



00:45:55.590 --> 00:46:11.130

Michael Palumbos ChFC, CBEC: We need to learn our blind spots. What don't we know. What are the questions you know, like you said earlier, how how am I supposed to be judging my advisors. I have no idea whether you know most people don't have any idea how they should judge those people, and so to set those parameters up



00:46:11.240 --> 00:46:18.140

Michael Palumbos ChFC, CBEC: is wonderful. And if you Google on the Internet what they say about hiring like a wealth manager.



00:46:19.150 --> 00:46:32.610

Michael Palumbos ChFC, CBEC: I I think that just scratches the scratch of what you really you need to know. It's you know it's Here's the questions to ask. Well, anybody can answer the questions right. But do they really have the muster to be able to deliver.



00:46:32.800 --> 00:46:48.000

Kirby Rosplock: Well, similarly with hiring, as you know, multi-family office or any institutional advisor. And you know I'm, Cameron, i'm. In in the handbook we have a whole litany of questions that go so far beyond.



00:46:48.000 --> 00:46:59.200

Kirby Rosplock: and a lot of folks don't sort of realize why it's so important to know if your ria is also coupled with a broker dealer, which is also coupled with the custodial.



00:46:59.200 --> 00:47:15.260

Kirby Rosplock: you know. So, to understand sort of what you think you are buying, and all the different services that might look like. Oh, they're not connected. And then you're like, oh, no, They're all under the same parent company or wholeco. So



00:47:15.300 --> 00:47:30.360

Kirby Rosplock: you know, even things like, Did you look at the form AV: and people are like what? And we're like, yeah, you want to read what their disclosures are like? Have they ever been written up? Are they? Has they have a fraudulent activity, or, you know, be dinged by the Sec. So



00:47:30.360 --> 00:47:41.880

Kirby Rosplock: again, I think there's a lot of really really important things, whether it's in an advisor or it's actually an institution to know how to be able to really do the diligence.



00:47:43.440 --> 00:47:50.880

Michael Palumbos ChFC, CBEC: And then tamarin partners does all the work for the family offices, and provides, you know.



00:47:51.390 --> 00:47:55.440

Michael Palumbos ChFC, CBEC: consulting services to help them individually as well correct.



00:47:55.860 --> 00:48:13.440

Kirby Rosplock: Yeah. So camera partners is interesting. I call myself a translator. So, having worked inside of operating family office entities, Mfo included, I can translate to owners sometimes things that they don't understand what their people do.



00:48:13.520 --> 00:48:22.310

Kirby Rosplock: Okay, and vice versa. I can hear owners say, this is what I really want is my family office doing it are able to do this.



00:48:22.710 --> 00:48:28.980

Kirby Rosplock: And then another major time I get hired is transitions, and i'm not just talking about succession.



00:48:29.080 --> 00:48:46.220

Kirby Rosplock: But i'm talking about like trust termination. I'm talking about retirement of key figures i'm working for one office right now. That's been actually unwinding over several years, and that requires a whole different like



00:48:46.220 --> 00:48:52.700

Kirby Rosplock: skill set to think about uncoupling, but still maintaining certain level of service.



00:48:52.920 --> 00:49:10.500

Kirby Rosplock: So there's there's a lot of complexity, and guess what every family and every family office I walk into. I go to it with again a beginner lens, thanks to J. Hughes, I don't assume anything, and people say, well, isn't there a best practice? Should we always do this or that? And I said, you know what



00:49:10.840 --> 00:49:20.800

Kirby Rosplock: every family is gonna have. Their own bespoke needs. And what worked for this family that might be who you idolize. Well, that may not work for you. So



00:49:20.940 --> 00:49:30.090

Kirby Rosplock: there is a lot of work that has to be done at different ages and stages of both the entity itself, but also of the family.



00:49:30.110 --> 00:49:33.280

Kirby Rosplock: and then I sometimes have to pull the family to say



00:49:33.490 --> 00:49:41.020

Kirby Rosplock: you've over built, or you've under built like you have too much stuff, or maybe you don't have enough infrastructure



00:49:41.140 --> 00:49:45.330

Kirby Rosplock: to help them. Think about the resourcing paradigm, to how to support



00:49:45.570 --> 00:49:55.760

Kirby Rosplock: what the mandate is. And and then, oh, by the way, there's this thing called budget, and like what does it all cost, and who pays for it? And how does that get done? And sometimes that is



00:49:55.840 --> 00:50:05.250

Kirby Rosplock: very differently received from you know one generation that's set up a family office to subsequent generations who are like, oh.



00:50:05.420 --> 00:50:10.140

Kirby Rosplock: I have to pay for this now or this is how much it really costs. And you're like, yeah.



00:50:10.340 --> 00:50:15.350

Kirby Rosplock: this is how much it really costs. So you know, nothing is for free.



00:50:15.430 --> 00:50:21.020

Kirby Rosplock: And you know, family offices are certainly a paradigm that is not for free



00:50:21.630 --> 00:50:22.540

Michael Palumbos ChFC, CBEC: a great.



00:50:22.630 --> 00:50:40.670

Michael Palumbos ChFC, CBEC: we last thing, and I think that it's just kind of popped into my head as you're speaking. Remember what I say. A lot of the people that are listening to this show own a a an operating business right now. So you might have, You know, a business. It's worth a 100 milliondollars.



00:50:41.010 --> 00:50:52.360

Michael Palumbos ChFC, CBEC: and and if you have a business work that the odds are that you have some investments and what not, that are significant, and you have some complexity in your life. That's significant.



00:50:52.550 --> 00:51:11.340

Michael Palumbos ChFC, CBEC: What would be some of you know, but they may not have enough assets to open it, even to go to a multi family office. It's very possible. But the complexity of all of that stuff. What would be some of the what would advice would you give them to say, you know, Where should they be reading? What should they be looking for? How do they take the advice



00:51:11.430 --> 00:51:14.600

Michael Palumbos ChFC, CBEC: that they're getting to the next level and get ready



00:51:15.300 --> 00:51:21.880

Michael Palumbos ChFC, CBEC: got, you know, if they do sell the business, and even if they don't, if they decide to leave it in there. But there's things that they need. Is that



00:51:22.110 --> 00:51:33.790

Kirby Rosplock: what would you say to them? Just highlight, and just make sure that they have a good awareness of is one that the people that work in their operating entity



00:51:33.850 --> 00:51:48.520

Kirby Rosplock: are not necessarily pulled to oversee investments. So it's really really difficult when you split your people and ask them to have 2 different allegiances. So it's also a. No, no! To compensate



00:51:48.690 --> 00:52:02.410

Kirby Rosplock: your operating folks potentially on the growth of your investment portfolio. No, no, no, don't do that. Try to really start to carve out and separate those 2 worlds, because, quite honestly.



00:52:03.060 --> 00:52:10.000

Kirby Rosplock: there is a lot of power that you put in the hands of few, if you give them that much access, that much knowledge?



00:52:10.010 --> 00:52:10.790

Kirby Rosplock: And



00:52:10.830 --> 00:52:22.480

Kirby Rosplock: who which master are they working for? Are they working to maximize the the trust assets or multiple investment account assets. Are they really maximizing their efforts towards the operating entities? So



00:52:22.500 --> 00:52:24.040

Kirby Rosplock: a a good



00:52:24.080 --> 00:52:40.120

Kirby Rosplock: That process early on is that if you're building wealth in a retirement account in separate accounts, try to really separate that from the operating day to day entity, and be mindful that you're thinking about? What's that full of capital for?



00:52:40.120 --> 00:52:46.360

Kirby Rosplock: Is it an emergency fund? Is it a rainy day fund? Is it for your errors for the future? Do you want to give it all away.



00:52:46.440 --> 00:53:01.810

Kirby Rosplock: So whatever you're building, that well for be very purposeful, intentional. So you know how it should be managed that you don't bet the farm and invest as some angel in something when you really needed that as current income to maintain your lifestyle?



00:53:01.920 --> 00:53:02.950

Kirby Rosplock: No, no.



00:53:03.180 --> 00:53:17.710

Kirby Rosplock: So again, if it's to feed the business, and to, you know, come in for capital, fusion, for growth, or whatever. Just be very mindful what that pool of capital is supposed to do. I think the other major



00:53:18.320 --> 00:53:22.710

Kirby Rosplock: question I get a lot is like, Well, when do I need to start thinking



00:53:22.860 --> 00:53:32.990

Kirby Rosplock: about a family office, or do. I need a family office, and I try to remind people that that typically the family office becomes



00:53:33.140 --> 00:53:49.990

Kirby Rosplock: appropriate when you have this scale. But you also know that you will be creating to some degree a separate entity. So you know again, Don't, try to have it all operate under operating hold code, and that at some point you might have a different



00:53:50.000 --> 00:53:57.860

Kirby Rosplock: intention. Some families say I want to create an investment Oriented family office, where they really want to make money with their money



00:53:57.940 --> 00:54:13.690

Kirby Rosplock: versus a lifestyle or services based family office which is really to support right. The State planning trust, tax compliance, governance, supporting services to a family with a lot of complicated entities.



00:54:13.690 --> 00:54:20.120

Kirby Rosplock: So I think it's really important to start to map out what you think this wealth is for what you want it to do.



00:54:20.200 --> 00:54:22.030

Kirby Rosplock: And then, lastly.



00:54:22.050 --> 00:54:39.270

Kirby Rosplock: right 2 last things: one: how much do you want to pay? Because nobody takes into account the startup cost of a family office. They think already to the operating expenses of it so like oh, you know, it's maybe 50 bits a 100 bits, you know. 1%



00:54:39.380 --> 00:54:44.900

Kirby Rosplock: point 5. But the reality is, there is oftentimes a lot more startup costs



00:54:44.930 --> 00:54:49.740

Kirby Rosplock: associated that are sunk their fixed cost. You're not going to recoup these.



00:54:49.890 --> 00:54:55.900

Kirby Rosplock: So it's important to be really clear on how much you want to invest in creating this structure.



00:54:56.170 --> 00:55:01.340

Kirby Rosplock: Because if you're if you don't and participate in lasting for at least a decade less.



00:55:01.400 --> 00:55:02.710

Kirby Rosplock: Don't do it



00:55:03.130 --> 00:55:13.860

Kirby Rosplock: don't don't go down the long arduous process to get that up and running because it's a it's a good one to 2 year endeavor, and sometimes longer. If you're a very complicated family.



00:55:14.580 --> 00:55:24.750

Michael Palumbos ChFC, CBEC: and it when you put it in the framework of it when you say expensive we're not talking about 25 grand or 30 grand or 50 grand, correct?



00:55:25.290 --> 00:55:29.170

Kirby Rosplock: No. i'm talking like you know



00:55:29.260 --> 00:55:39.960

Kirby Rosplock: one mill two-mill like I'm talking a a much bigger expense depending on the complexity. I mean. I I know folks who spend.



00:55:40.150 --> 00:55:44.850

Kirby Rosplock: you know, a 1 million dollars on the State planning. So that's where i'm like.



00:55:44.920 --> 00:55:47.230

Kirby Rosplock: Just be mindful of



00:55:47.400 --> 00:56:00.030

Kirby Rosplock: what you what you think you need. And again a lot of attorneys will say, oh, I can. I can create you. I can set up a structure for you, and maybe they can do it for 50 or 100 or $200,000 rate.



00:56:00.170 --> 00:56:12.270

Kirby Rosplock: But at the end of the day. It doesn't mean it works. It means you have the legal documents drafted and submitted. But now you gotta hire the people. Now you get to create compensation plans.



00:56:12.270 --> 00:56:20.670

Kirby Rosplock: Now you have to create an operating budget. Now you gotta create risk controls. So there is a ton of work just like any other kind of operating company



00:56:20.830 --> 00:56:29.790

Kirby Rosplock: that's required, and and Don't underestimate that not to scare anyone away from doing it, because there's tremendous obvious reasons to do it.



00:56:30.010 --> 00:56:32.850

Kirby Rosplock: I just I just always find that



00:56:33.300 --> 00:56:45.130

Kirby Rosplock: many folks imagine what it's like to be happy again versus getting it up and running. and and there there is oftentimes an on-ramp to scaling up a family office.



00:56:45.340 --> 00:56:53.820

Michael Palumbos ChFC, CBEC: That is the first time anybody's talked to me on this show about that. So I really want to say thank you for that, because it's we. You know



00:56:53.890 --> 00:56:56.740

Michael Palumbos ChFC, CBEC: we don't think that there's any right or wrong



00:56:56.800 --> 00:57:18.670

Michael Palumbos ChFC, CBEC: for any family I mean, let's let's say if you get, you know, 10 million dollars. You're not opening up a family office. You're not joining a multi family office. But but there, you know, virtual family office. You you need to have somebody or an outsource family office. You need somebody that understands that interconnection of all of those pieces



00:57:18.710 --> 00:57:30.500

Michael Palumbos ChFC, CBEC: and and a lot of people, you know I I've had the question. When should I start a family office? When should I, you know? Move away from just you, Mike, or you know you and the team that I have right now.



00:57:30.610 --> 00:57:48.230

Michael Palumbos ChFC, CBEC: and my answer was always, you know, somewhere around a 100 milliondollars is probably the right time to be thinking about that, but based on what you just said in terms of, you know, to have a 1,000,002, 3 millionjust to get start up going.



00:57:49.670 --> 00:57:55.720

Michael Palumbos ChFC, CBEC: That would yeah, and a 100 millionthat would scare a few people to say a multi-family office might be good.



00:57:56.280 --> 00:57:59.920

Kirby Rosplock: Yeah. I mean the people that build a family office



00:57:59.960 --> 00:58:03.090

Kirby Rosplock: control control, control.



00:58:03.450 --> 00:58:06.770

Kirby Rosplock: customization, customization, customization.



00:58:06.850 --> 00:58:15.010

Kirby Rosplock: They're not afraid of costs because typically they have in their minds how they're making up that money, or they're making so much more money.



00:58:15.050 --> 00:58:18.580

Kirby Rosplock: The cost is not necessarily the driver.



00:58:20.220 --> 00:58:26.960

Kirby Rosplock: but they want the dedicated resources. They want the privacy. They want the customization.



00:58:27.640 --> 00:58:36.530

Kirby Rosplock: Yeah, that's those are the big drivers for building it out. And then they also have this idea that this is an entity that outlives them



00:58:36.610 --> 00:58:37.680

Kirby Rosplock: and not



00:58:37.780 --> 00:58:44.580

Kirby Rosplock: control like dead hand way. That's about. How do we



00:58:44.740 --> 00:58:50.220

Kirby Rosplock: create a structure that allows for smooth and seamless wealth transfer? How do we



00:58:50.490 --> 00:58:59.750

Kirby Rosplock: think about as the protection, and you know soft landings for future generations who don't have to come up and figure out how to be successful, and



00:58:59.770 --> 00:59:02.470

Kirby Rosplock: you know, in our career or anything else. I mean.



00:59:02.610 --> 00:59:11.210

Kirby Rosplock: I think there's a lot of reasons why multi-generational family offices exist. But don't kid yourself. There's a lot of planning there's



00:59:11.380 --> 00:59:17.900

Kirby Rosplock: continual improvement, and you know i'm a big believer that they're always learning and evolving.



00:59:19.150 --> 00:59:33.250

Michael Palumbos ChFC, CBEC: I have loved this conversation, and you just reminded me you know it's seventh generation. Thinking is kind of why you might be doing this and that, you know, Jay Hughes, you know, pounds on that regularly.



00:59:33.290 --> 00:59:46.430

Michael Palumbos ChFC, CBEC: And then one of my other mentors always, said Michael, when we're talking about transition planning, whether it's a business or in a state it's. Think of 2 things smooth and orderly cost and tax efficient.



00:59:46.460 --> 00:59:54.410

Michael Palumbos ChFC, CBEC: and though the family office may not be cost and tax efficient to begin with, over 7 generations.



00:59:54.860 --> 00:59:59.140

Michael Palumbos ChFC, CBEC: that makes a lot more smooth and orderly, and a lot more cost and tax efficient, probably.



00:59:59.820 --> 01:00:11.550

Kirby Rosplock: Yeah. And let's not. Let's give our hats off to all the you know family businesses and operating businesses out there, because the shared ownership and the discounting that happens with



01:00:11.560 --> 01:00:19.250

Kirby Rosplock: closely how businesses is another huge tax saver, and I, you know, I really believe that



01:00:19.260 --> 01:00:37.340

Kirby Rosplock: we need to help fortify the fabric of family firms as much as we can, since we have a lot of pressure right from these massive conglomerations that quite honestly are sort of consuming and and chewing up a lot of these



01:00:37.340 --> 01:00:56.090

Kirby Rosplock: family run companies that either our first generation, second generation or beyond. So I You know I do think that the family office can be a complimentary structure to operating families who want to figure out how to keep it in the family, or keep it going beyond one generation or the next.



01:00:56.410 --> 01:00:57.150

Michael Palumbos ChFC, CBEC: Right?



01:00:57.230 --> 01:01:12.910

Michael Palumbos ChFC, CBEC: All right. You and I could talk for the next 3 h, and probably not get winded, because this is just. We love this stuff, and we love serving and helping the families that we do serve on a regular basis. So Kirby Ras Block from tamarin partners. Cameron learning.



01:01:13.020 --> 01:01:23.170

Michael Palumbos ChFC, CBEC: Thank you. Thank you. Thank you for sharing your wealth of knowledge, and I know that you know if anybody wants more of what you've heard today.



01:01:23.260 --> 01:01:41.290

Michael Palumbos ChFC, CBEC: Go grab your book. You can go to tamarin partners, tamarin learnings and tamarin is out there. You can connect with Kirby, i'm sure on Linkedin and a number of different ways. But thank you so much for sharing today.



01:01:41.440 --> 01:01:50.020

Kirby Rosplock: Hey, Michael, it's my pleasure. It's just great to be in your company, and I hope we've left your listeners and viewers with something they didn't know



01:01:50.430 --> 01:02:17.710

Michael Palumbos ChFC, CBEC: 100. Thank you. Everybody for joining us today. I'm Michael Columbus with family wealth and legacy, and Rochester, New York, and you've been listening to the family business show. If you've enjoyed this episode and know somebody that might also like it, feel free to share it with them. But more importantly, if you know of a family business that you think would be a great guest, and would like to share their story. Make sure that you tap them, and let them know about us. We'd love to have them on the show.



01:02:17.980 --> 01:02:20.410

Michael Palumbos ChFC, CBEC: Thank you, everybody, and have a great day.

If you’re a family business or a family business consultant and want to be on the show, share your story and help other family businesses, send us an email to or fill out a contact form here!

*not affiliated with Lincoln Financial Advisors Corp.

Michael Palumbos is a registered representative of Lincoln Financial Advisors Corp. Securities and investment advisory services offered through Lincoln Financial Advisors Corp., a broker/dealer (member SIPC) and registered investment advisor. Insurance offered through Lincoln affiliates and other fine companies. Family Wealth & Legacy, LLC is not an affiliate of Lincoln Financial Advisors Corp. Lincoln Financial Advisors Corp. and its representatives do not provide legal or tax advice. You may want to consult a legal or tax advisor regarding any legal or tax information as it relates to your personal circumstances.