Law Firm Succession Planning (Part 1 of 2)
Four Reasons to Have a Succession Plan for your Law Firm
In addition to your state’s ethics rules, which we are not addressing in this blog, here are four other business and personal reasons to have a succession plan in place for your law firm.
- Protect your clients. Law firm succession planning is not only for you—it is also for your clients and anyone who works for and with your firm. Solo and small firm lawyers put their clients and business at risk if they do not have a succession plan in place. Solo and small firm lawyers should consider naming a transition attorney who will be responsible for managing their firm for a period of time should anything happen to them. This person can oversee a transition plan, send invoices for unbilled time, collect outstanding invoices, and provide a softer landing for your loyal employees.
- Prepare for expected and unexpected events. Many attorneys assume they only need a succession plan when they are considering retirement. However, you may want to plan for unexpected events such as a family emergency, illness, disability, or death. Although this is difficult to fathom, you do not want to leave your employees and clients wondering what to do when an attorney at your firm dies.
- Lower your Professional Liability Insurance Costs. Insurers prefer, and often times expect, that you will have a proper succession plan in place. No succession plan signals a higher risk profile. A higher risk profile usually results in higher premiums.
- Capitalize on the Fruits of Your Labor. Do not let years of hard work go to waste! You have put a lot of effort into building your business and developing your brand and reputation. A well thought out law firm succession plan can give you peace of mind now while maximizing your financial rewards during your retirement years (or for your family). Having a law firm exit strategy also gives you peace of mind should anything happen to you.
If you would like assistance or ideas regarding a succession plan for your law firm, please contact us and we will be happy to assist.
For assistance with any legal matters related to your business or estate planning, contact Fournier Legal Services at jfournier@jeflegal.com or 860.670.3535 now for a consultation and planning session.
Joseph E. Fournier is an Attorney and a CPA who has more than twenty years of experience in a variety of business legal matters, including start-ups and company formations, drafting shareholder and operating agreements, contracts, employment law, commercial litigation, tax planning and audit defense, and mergers and acquisitions (M&A). He also handles estate planning matters, such as business succession planning, wills, trusts, and probate.