Don't Waste Your Money on Lawyers
Lawyers are expensive. Whether you are involved in a transaction such as buying a business, or caught in litigation and having to defend yourself in court, the lawyer fees can mount quickly. Running into hundreds of dollars an hour, these fees can accumulate to thousands for something as basic as reviewing a contract, and your itemized bill can leave you with sticker shock. Every person who has hired a lawyer know this, and jokes about pricey legal fees abound. So what to do? Don’t waste your money on lawyers.
“Ahh — good one. A slick lawyer trick to show how your fees are lower, and that I should choose you instead.” Not quite. At the moment, I think our fees are probably a bit higher than the average in our county (for example, I bill at $395 per hour as of October 2018, and expect to raise rates January 1). That is all the more reason for you not to waste your money.
Hiring a lawyer is, and must be, an investment in your future, and with every invoice you should ask yourself “what kind of return am I getting on my money?” With that in mind, here are some things to consider as you work with your lawyer:
Ask, ask, ask. Your lawyer is a professional who has spent years studying the law and the legal system, learning about approaches to problem-solving and discovering counter-intuitive ways some issues get worked out in the courts. You are hiring them to advise and guide you, which means you should come out of the experience with more knowledge and a better sense of how to handle legal questions in the future. Ask your lawyer to explain terms you don’t understand, processes which don’t make sense to you, or strategic moves which don’t square with your experience. By asking questions, your investment provides you with information which will serve you for years to come.
Review every invoice carefully. Your bill tells the story of the work being done for you, so take the time to read each line and confirm you understand where the story is going. Your invoice may be a one-liner: “Draft, finalize, and file trademark application in class 25.” Even then, ask yourself — “what does the money pay for?” At Creedon PLLC, our current flat rate for a trademark application is $1,300, which is quite a bit more than sites like Trademarkia or LegalZoom. If you are wondering why, good — you should be. Talk to your lawyer and find out what each line on your invoice means. For example, why did a partner do some work and an associate other work (and what the heck do those terms even mean). Your invoice is the monthly chart of your dollars at work, so be certain to understand it.
Get a budget in advance. Asking for a budget gives you two things immediately: a sense of how much money will be required over time, and a roadmap of where the work is going to happen. For many kinds of work (trademark filings, contract reviews, company formations), many lawyers can offer a flat rate. Be certain to ask exactly what is included! For litigation or longer transactions, a budget will be much more conditional and will shift and change. That’s normal! Ask for a range of values, or for an explanation as to which numbers shift the most and why. For example, discovery (the process of both getting and giving documents and statements related to a case) is notoriously hard to budget — are we talking about 500 pages or 500,000? One deposition (sworn interview) for four hours, or four depositions lasting one day each? Your questions up front will reduce surprises down the road, and will help you to plan your investment and determine if it is worth the cost.
Prioritize your spending. Most people hiring a lawyer have many things they’d like to spend their money on, and that may even include multiple legal services. Don’t feel compelled to do it all at once. Rather, think carefully about which investments are the most necessary, and which can wait until later. If you are starting a business, you will almost always make forming your entity (for example, an LLC or a corporation) a very early step, but perhaps securing copyright protection on your software code can wait. (Perhaps not! This is an excellent question to ask early on.) One way to manage this is to ask your lawyer explicitly: “what do I need to do now, and what investments am I looking at over the next year?”
Hiring a lawyer is a big step, but you are the one in control — and the person best able to determine what is right for you and your business. While there is never a guarantee of success, you can always demand the guarantees of clear communication, honest assessment, and a commitment to improving your knowledge over time.
Take charge — and don’t waste your money on lawyers.