Most Firms Not Exactly Sure How Much Money is Coming In

According to the Clio 2021 Legal Trends Report.

More than eight in 10 lawyers say firm revenue is the most important financial metric for tracking the performance of their practice.

But most of them admit they don’t have a firm grasp of exactly how much money is coming in.

Those are two findings from the 2021 Clio Legal Trends Report.

Another finding: 56 percent of firms not only survived the pandemic but actually grew their revenue, with one in four reporting growth of 50 percent or more.

“The good news is that these figures indicate that many firms may have adapted to and overcome the challenges of the past two years,” according to the Clio report. “The bad news is that these figures might not be entirely accurate. We asked the same lawyers how confident they are about their knowledge of these revenue figures, and 40 percent reported being only somewhat confident, while a further 20 percent were slightly or not at all confident. Put simply, while many lawyers may believe that their firms are on the right track financially, some of them don’t truly know whether this impression is accurate.”

Read the 2021 Clio Legal Trends Report here.

Want a sweet discount on Clio practice management software products? You may be eligible if you practice in Wisconsin, Texas, Minnesota, Ohio, Illinois, Indiana or Michigan and are a member of the Alta Pro Lawyers RPG. In addition to Clio discounts, you’ll get access to free webinars, the Pro Practice Playbook, Reminger ProLink, Ask the Risk Pro and more. Here’s how to join.

2021 Clio Legal Trends Report

Here are some key takeaways from the Clio report:

  • Many lawyers don’t think their legal education adequately trained them to run a law firm. Only 7 percent said law school prepared them to run the business side of things.
  • 76 percent of lawyers feel overworked.
  • A large portion of firm managers don’t have insight into their business’s revenue and spending, two key areas that determine a firm’s financial performance. When asked How confident are you that you know your firm’s revenue? only 40 percent said “very confident,” while another 40 percent said “somewhat confident.” The remaining 20 percent were either “slightly confident” or “not at all confident.”
  • 54 percent of lawyers said they are very involved in their firm’s finances, while 17 percent were somewhat involved. The remaining 29 percent reported little or no involvement.
  • 86 percent of lawyers who said they were very involved in their firm’s finances are managing partners, senior partners, or solo attorneys. Associates, legal support staff, and administrative staff reported only low rates of financial involvement.
  • 51 percent of solo attorneys and managing partners said they are very confident about their firm’s financial status, while just 48 percent of senior partners reported being very confident about their knowledge.

Read the 2021 Legal Trends Report Online | Clio

The end of the year is a stressful time for everyone, but it’s especially stressful for lawyers and legal professionals. Closing out case matters, completing Q4 financials, shopping for presents, making holiday plans. There never seem to be enough hours in the day to get everything done. The key to easing your stress could be Micro Self-Care. What’s Micro Self-Care? Attend our annual wellness webinar “What is Micro Self-Care and Why Do You Need It?” on December 14 and find out. The presenter, Michael Kahn, is a JD and licensed therapist who concentrates in treating lawyers struggling with stress, depression, substance use disorders, and other career issues. This free, one-hour webinar is the latest in Alta Pro’s ongoing series of cutting-edge legal education programs. Sign up here.

Share

Share on facebook
Share on twitter
Share on linkedin

Let Alta Pro RPG Help You Get Insured

Quick turn around times. Hassle free insurance.

Join Our Mailing List

Subscribe to our exclusive mailing list and get the freshest stories from the Alta Pro RPG team.

Continue Reading