Practicing law profitably updated 2013
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Practicing Law Profitably Philadelphia 2009 Updated 2013 Ronald L. Burdge, Esq. Dayton, Ohio What I Learned From 35 Years in my Lemonade Stand © 2009, 2013 R.Burdge
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Tips for the new attorney on practicing law profitably, original presentation at NACA national conference in Philadelphia, PA in 2009, updated 2013.
Transcript of Practicing law profitably updated 2013
Practicing Law Profitably
Philadelphia 2009Updated 2013
Ronald L. Burdge, Esq.Dayton, Ohio
What I Learned From 35 Years in my
Lemonade Stand
© 2009, 2013 R.Burdge
Ingredients
Water
+ Lemon Juice
+ Sugar
= Lemonade
= Profit ?
Knowledge
+ Time
+ Effort
= Clients
= Profit !
• Agenda for Building a Practice
• Some Rules of the Road
• Knowing Your Numbers
• # 1 Law Practice Problem
Tips on Starting a Law Tips on Starting a Law Practice Without ClientsPractice Without Clients
Without Starving
“Real Life’ Version
# 1# 1
Read
Jay Foonberg’s
Book
# 2# 2
Market Yourself To Other Lawyers
1+ 1 + 1 + 1 + 1 = 1Referrals Matter
# 3# 3
Pay Referral Fees In Cookies
To Referring Attorney’s Secretary
# 4# 4
Get An Easy-to-remember
Phone Number
# 5# 5
Master Social Media Marketing
(Nobody Else Has)
# 6# 6
Avoid Costly Phone Book Display Ads
The internet is the phone book of this age
# 7# 7
Pick An Easy-to-find Location
For Your New Office
Near other Attorneys
# 8# 8
Create Your Own Web Site
Use A Catchy Name
Get 3 Url’s:1. Your Name2. Your Law Practice Name3. The Name of Your Specialty
# 9# 9
Limit Contingency Fee Cases
To ½ Your Case Load
(or less)
# 10# 10
The Best Advertising:
A Happy Client
Your Client’s Case is Your Case … Make It Personal
Your Bonus Time !
www. The Law Coach .com
Click on the picture
Read the Chapters in your spare time
Practicing Law ?
This is Not it!
Riches to Rags
TheKingofTorts
Melvin Belli
Filed Bankruptcy
-Fame
WithoutFortune?
Rags to Riches
He went from thinking about suicide to thinking about livingAnd made money in the process – Don’t Give Up - EVER
Old RuleOld Rule
$ in$ in-Bills paid outBills paid out
== $ Left Over $ Left Over (your profit)(your profit)
New Rule
It’s a Business
Run It Like One
The Name of the Game: Profit
“What do you mean, my paycheck will be a little late this week?”
Is this what your secretaryor your wife will say?
New Rule
Do What you Know How to Do
Be a Lawyer
Not a Business Manager
New Rule
Control Your Business ?
Hire a Business Manager
SCORE.org
Cheap
Easy
and Good
New Rule
Have a Budget
And Live By It
Lots of Forms Online For this
New Rule
Know Your “Break Even” Number
Know Your Daily Number
How much money
do you need to make today
To have a job tomorrow?
New Rule
What Are You Worth ?
Calculate Your Hourly Rate
By Reverse Calculating It
The next slide will tell you how
Know Your Numbers
EGN IGN = Hourly Rate
Expense Generating Numbers
Divided by
Income Generating Numbers
= Hourly Rate
Expense Generating Numbers
Taxes Rent
Salaries Telephone
Utilities Debt Retirement
Supplies Equipment
Repairs Advertising
Maintenance Insurance
Income Generating Numbers
Total Firm Billable Hours
(you and anyone else)
Total Firm Billable Hours
Attorney
Paralegal – Law Clerk
Secretary
Not all billable time is equal
Weight the Rates
0
0.25
0.5
0.75
1
AttorneyParalegalSecretary
Weekly Billable HoursWeighted
RateAvailable
HoursBillable Hours
Attorney 1 45 45
Paralegal .5 40 20
Secretary .25 20 5
Total 70
Reverse Calculate Your Hourly Rate
Example:
1 Attorney - $120 k Salary
1 Paralegal - $45 k Salary
1 Secretary - $35 k Salary
Reverse Calculate Your Hourly Rate
Expense Generating Numbers
Divided by
Income Generating Numbers
= Hourly RateLet’s look at an example
on the next page
Expense Generating Numbers
Taxes Rent
Salaries Telephone
Utilities Debt Retirement
Supplies Equipment
Repairs Advertising
Maintenance Insurance
= $7,000 / wk
Reverse Calculating Hourly Rate
Now add 15% to it:
$7,000 + 15% = $8,050 (EGN)
Why?
Because you will Always Underestimate Actual costs
(that’s just the way life works)
Reverse Calculating Hourly Rate
Now divide your EGN
By your IGN + 15%
Why decrease it?
Because you will Always Over-estimate Actual Billed Hours
Or some billable hours will go unpaid
(that’s just the way it works out)
Reverse Calculating Hourly Rate
$7,000 + 15% = $8,050 (EGN)
Divided by
70 – 15% = 59.5 hours (IGN)
= $ 135.29 Hourly Rate
so round it up $140
New Rule
Track Your Time
Bill Your Time
Get Paid for Your Time
Unless you are independently wealthy
And can afford to work for free
(lucky you)
New Rule
It’s a Business
Run It Like One
The Name of the Game: Profit
You can’t help people tomorrow
If you don’t make a profit today
New Rule
The Cost of Losing Billable Time?
You Can’t Afford It
New Rule
15 min / day = 1.25 Hr / wk
= 65 Hr / yr
65 Hr x $140 …... = $9,100When your time goes down the drain
Your money goes with it
You Can Have Bonus Time, or Money Lost
Hint – Bonus Time is a lot better
# 1 Practice Problem
Fighting
over Fees
Start from “Day One”
• Use Written Fee Agreement
• Get It Signed
• Detailed Time Records
• Bill Regularly
Monitor Fee Bills
• Keep Bill Paid Current
• Suspend Work if Need to
• Withdraw if You have to
Fee Disputes
Don’t Sue Your Client
Landry v Haartz
Nasty, nasty, nasty consequences
In Case of Doubt …
Write It Off
Learn The Lesson
Move On
Top 3 New Rules
To Really Succeed
1. Be a Lawyer, not a Manager
2. Know Your Numbers
3. Don’t Fight Over Fees
4. The Secret to Success ?
The Real Secret to
Financial Success ?You’re not going to believe this …
The Real Secret to Financial Success
Economists Studied it
Doctors Tested it
Psychiatrists Worked on it
Neurologists Proved it
They all came up with the same Answer
The Real Secret to Financial Success
Doing “it” for money
Doesn’t make money.
Doing “it”
For the sake of doing “it”?
That’s what makes money…
The Real Secret to Financial Success
They studied “it” at:
Harvard – 6 yrs, 30,000 people
Stanford, Syracuse Universities
Mayo Clinic, 2001, 1,200 people
John Hopkins Medical School, 2 yrs
National Academy of Sciences
National Inst. Of Neurological Disorders
etc
The Real Secret to Financial Success
“It” has been written about in:
Journal of Business Strategy
The Economist Magazine
Psychosomatic Medicine Journal
Social Science & Medicine Journal
Journal of Gen Internal Medicine
Journal of Economics & Finance
etc
The Real Secret to Financial Success
They All(doctors, scientists, economists, business professionals, etc)
came up with the same Answer
Giving Makes You Rich
See? I told you that you wouldn’t believe it … but it’s true
Giving Makes You Rich
It has been scientifically and medically proventhat when you give it away
(whatever “it” may be)You earn more money
No one knows why it works,It just does!
So, to make more money and feel better about it too:
• Give back to your clients– Do something for free once in awhile
• Give back to your community– Volunteer for a good cause – not just money
• Give back to your profession– Help others when called on to do so
Practicing Law Profitably
Philadelphia 2009Updated 2013
Ronald L. Burdge, Esq.Dayton, Ohio
What I Learned From 35 Years in my
Lemonade Stand
© 2009, 2013 R.Burdge
