Compared to other legal specialties, real estate law is less theoretical and more results-oriented, attracting lawyers who enjoy the chance to focus on a single discipline.
Practicing solo gives you independence and a degree of control not typically found in large or nonprofit law offices.
CPA Ann Irons, whose experience includes providing accounting and bookkeeping services for real estate law offices in Bellingham, MA, has had the opportunity to work with several clients who've gone solo. She shares five of the most common mistakes that can make or break a newly established solo law practice
Committing for the Wrong Reasons
We often see lawyers pursue a solo practice with the intention of forging ahead until something more lucrative comes along. This creates several problems, not least of which is the inability to remain agile. What happens when, after several years on your own, that something comes along? You've invested heavily and must now liquidate your assets, make appropriate arrangements with your existing clients and staff, and resolve contractual obligations. Some contracts, such as utility bills, can be easily terminated. Others, such as building leases, may not be broken without incurring hefty fees and penalties.
Limited Startup Capital
If you intend to fund your venture by taking out a loan, you'll need a clear plan of action for lenders' consideration. A subjective statement will not secure a loan, no matter how eloquently stated. Plan to gather forecasts for the number of clients within your geographic market, an estimate of service charges and fees, comparable prices and fees from competitors, industry analysis, and specific figures from your chosen market, whether residential, commercial, or both. Ann Irons, who has extensive experience preparing and analyzing financial statements and reports, can assist you with this important step.Underestimating the Time and Financial Requirements vs. Pay
Even very successful lawyers find that their first few years in a solo practice are not always the most profitable. Startup costs are high, which means that very little will be left each month for your own compensation. The commitment and complexity required at this stage are such that it's all but impossible to establish your practice in 8 hours a day, 5 days a week. This may come as something of a shock for someone who has grown accustomed to the generous pay that comes with working at a larger practice, but your take-home pay during this time will be significantly less. Partnering with a Massachusetts CPA provides invaluable insight into balancing your personal and professional taxes and finances.
Focusing Entirely on Online Presence
An online presence and digital marketing strategy will play an important role in your reputation management, but your initial priority should be to cultivate your reputation. The best way to build that reputation is to actually connect with people, including prospective clients, leads, real estate professionals, and fellow attorneys. It's true that performing an online search is one of the first steps taken to locate a real estate lawyer, but it's up to you to ensure that you have the reviews, referrals, and social media cred that will make you stand out.
Lack of a Well-Defined Business Plan
Given the time and money involved, a comprehensive business plan is non-negotiable. When you bear the sole responsibility for your practice, it's best to anticipate every possible expense. A "come what may" mindset could bring financial devastation. Ideally, your business plan should include:
- A contingency plan
- SWOT (Strengths, Weaknesses, Opportunities, Threats) analysis
- Target market analysis
Take control of your real estate legal practice. To learn more about accounting and bookkeeping for small businesses and attorneys, or to request a meeting with Ann Irons, CPA, LLC, contact our office at . Our team services businesses and individuals in and around Bellingham, Woonsocket, and Boston.
Ann spent over 25 years in the financial service industry, gaining knowledge and experience that allows her to provide an array of tax, bookkeeping, and accounting services for her clients. Relying on a stringent code of ethics and a dedication to maintaining the highest industry standards, Ann works hard to ensure her clients receive the quality service they’ve come to expect. A member of AICPA and MSCPA, Ann has also had an article featured in the renowned publication, Banker and Tradesman. 
