Family Law News & Info
Tips To Reduce Legal Fees: Part I - How Attorneys Bill
One of the questions clients always ask is, “Why are attorneys so expensive?“ There are a variety of reasons for this. Examining these reasons might help you understand why attorneys charge the amounts they do and may help explain how attorneys bill for the services they are providing you.
Family law attorneys typically charge an hourly rate for their services. This means that, when they work on your case, they keep track of their time, and bill you proportionately from the number of minutes that they worked. For example, if an attorney drafts a complaint for you, and it takes the attorney a half-hour to do so, you’ll be billed for “.5 hours” or thirty minutes. This means you will pay an amount equal to one-half the attorney’s hourly rate for the time it took the attorney to draft the complaint. You generally sign a “Retainer Agreement” with the attorney that sets forth the hourly rate and states what up-front money the attorney needs to get started. This up-front money, or “retainer fee,” is the attorney’s assurance that he or she will be paid for the work done on your case.
Most attorneys have a monthly billing cycle, so at the end of each month, you’ll receive a bill showing each activity the attorney did (i.e., writing a letter, having a phone conversation with the opposing attorney, etc.), the time spent on that activity, and the charge for that activity. So, if an attorney’s hourly rate is $300, and he or she spends thirty minutes drafting a complaint for you, your bill for that activity will look something like this:
May 1: Draft complaint Time Spent: 30 min. Charge: $150
Because attorneys bill hourly, they must be sure that the amount they charge for their time factors in all of the expenses of running a law office. So, for each hour billed, a portion of the money helps pay for office rent, telephones, employee wages, internet access, insurance, business supplies, and taxes. Whatever is left over is the attorney’s profit or income for the work he or she has done on your case. Given the limited number of hours in each day, your attorney must charge enough to make sure that the attorney, too, can pay his or her bills. There are, however, some things you can do to help minimize your attorneys’ fees.
We will examine these things next...