In this week’s edition of Things I Wish I Knew, solo lawyer Joleena Louis gives her tops tips for offering payment plans to potential clients.
One of the most effective things a solo can do is know their worth and stay firm on their fees. If you don’t value yourself, clients won’t either. This is a lesson I learned quickly after opening my practice.
I’ve mentioned before that I almost never give discounts and I am usually paid in full before starting work. Because of my strict policies, I rarely ever have overdue accounts receivables. Sounds nice right?
As a divorce attorney, I often get asked about payment plans. Though payment plans go against my policy of being paid in full, after being burned a few times early in my practice, I learned that I was going to need some guidelines to make them work. Here’s what I came up with:
Know When to Accept Payment Plans
I don’t offer payment plans for every case because of the risk. It depends on how far along the case is. If I’m being hired at the beginning, I’ll be more likely to offer a payment plan than if I’m hired in the middle of litigation.
Have a Concrete Payment Schedule
In my experience, payment plans are more effective when I have a concrete plan, in writing, to present to the client, instead of asking how much they can pay and when. I’ll usually break the fee into no more than three payments over the course of 60 days. It gives me more flexibility to pay, and I’m more likely to be paid in full before a substantial amount of work is done.
Have a Plan To Collect Payment
The most convenient way for me to accomplish this is a credit card authorization, with the card being charged on the payment due date.
Make sure the agreement includes consequences for missed or late payments or if the card is declined. I usually require the entire fee paid at that point or I withdraw from the matter. So far this method has worked really well for me.
Reward Your Loyal Clients
I offer much more flexibility to longtime clients who have a history of paying in full and on time. I will usually allow these clients to make monthly payments because I can trust that I will be paid at the agreed upon time. These relationships just take time to develop.
If done correctly, payment plans are an effective way to close clients who can’t pay all at once. Does your firm offer payment plans? Let me know your strategy in the comments below!