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How To Spend Your Money (New Solo Week – Day Five)

Welcome to the final day of New Solo Week. While it won’t be New Solo Week next week, I’ll keep thinking about you and I’m confident that you’ll find value in every article going forward. It’s tough to build a family law practice, but it can be done. Welcome to the club and I hope to be of use to you as the days, weeks and months go by.

Every new solo I’ve ever met is operating on limited resources. They are consistently undercapitalized and frequently unprepared for the length of time it takes to generate profits. Unfortunately, many new family law practitioners spend money on things that don’t help them with long-term success. When cash is in short supply it’s critically important to analyze every expenditure and be certain that it gets you closer to the goal of profitability.

Here’s my list of priority expenditures for a family law practitioner -

1. Low cost blog/website with your own domain name (consider SquareSpace)
2. Lunch and coffee with referral sources
3. Pay per click advertising (Google adwords)
4. Substantive family law booklet for referral sources and prospective clients (repurpose this material on your website)
5. CRM system for referral sources (Highrise)
6. Google apps for email, word processing and spreadsheets
7. An executive suite or shared office for full or part-time use (Regus)
8. Laptop computer (Macbook Pro)
9. Internet connection
10. Cell phone (Nexus One, Motorola Droid or iPhone)
11. Scanner (Fujitsu Scansnap)
12. Printer (Brother)
13. Client Seminar invitations (to referral sources)
14. Seminar room rentals
15. Autoreponder email service (Aweber)
16. Hosted case management system (Advologix, Clio or RocketMatter)
17. Business cards
18. Legal research (Fastcase)

There are lots of other things to spend money on, but these are the highest priorities. You need to be up and running, marketing and meeting client needs. You need to be able to communicate with clients, get the work done and stay organized. I’m sure I’ve overlooked a few things, but these are the critical, priority needs and you should preserve your capital so you can keep going without feeling pressure to take work you shouldn’t, to cut fees to get work and to bail out before you’ve given it a chance.

If you find yourself with extra money use it to expand your marketing efforts. Stay focused on generating business. That’s the primary priority for your spending.

While we’re at it, here’s my list of very low priority expenditures. I wouldn’t spend money on these things until I had more than enough extra income. I might not ever spend money on these things.

1. Firm logo
2. Letterhead
3. Window blinds (don’t even ask)
4. Yellow pages, TV, Radio or print advertising
5. Brochures
6. Frames for diplomas or law licenses
7. Color printer
8. Fax machine (use MyFax instead)
9. Phone system
10. Copier
11. Art
12. Server
13. Accounting software (use Freshbooks)
14. Books
15. Postage meter (use Stamps.com)
16. Staff
17. Bar Associations (unless you really plan to attend meetings to grow referral network).

These are the things I thought of quickly based what has worked for me and what hasn’t. The bottom line is that you should spend on things that allow you to grow your practice and avoid spending on things that won’t help you now or maybe ever.

Are there things you would add to either list? Let me know in the comments below.

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  • http://www.GrahamLawCollaborative.com Kimberly Graham

    I suspect Trust Accounting software should be on List #1. In Iowa they show up unannounced on your doorstep every two years to check your books and they better be perfect. Trust accounting mis-steps are one of the major causes of lawyer discipline, so better to learn to properly handle trust accounts and keep solid books from the get-go rather than winging it.

    Would Freshbooks work with your trust accounting software or would that be used instead of it? PCLaw (which is what I use now for accounting) produces invoices and also keeps time so there isn’t a need for a separate thing like Freshbooks. (?) Or is there? But I want to get everything on my Mac (as I’ve mentioned) so keep looking for a better solution for trust accounting/invoicing all in one — would rather not have two programs when one will do. (Someone is missing a marketing opportunity, perhaps. MacLawyer Trust Accounting and Invoice/Timekeeping Software would rock. I’ve yet to see an AIO application that works well *and* is very user-friendly. I know there’s QB but even the CPAs I’ve spoken with only reluctantly recommend it — saying things like “well, most people use QB but it’s got a steep learning curve.”)

    p.s. Listened to your Podcast about Twitter today, great info. Thanks!

  • Jim Hart

    Kimberly,

    Is your issue with PCLaw that you can’t use it on your Mac? My understanding is that you can install Parallels on the Mac with Windows and then use Windows based programs on you Mac alongside the Mac applications. I know that a lot of software that would work great for attorneys is not yet compatible with Mac OS.

    Lee – do you have any suggestions on this?

    Thanks!
    Jim Hart

  • Lee Rosen

    Personally, I’m all for doing everything in the cloud where issues like Mac/PC no longer matter and managing software/servers becomes a thing of the past. That’s why I’d consider products like Freshbooks, Clio, Rocketmatter and Advologix.

    At the moment, I’m stuck with Quickbooks, but I’ve moved it to a server outside our office with a company that specializes in managing Quickbooks on remote servers so we’re no longer dealing with QB maintenance issues.

    Lee

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