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March 01, 2018 GPSolo

A Retiring Lawyer’s Story

Edited by Ariadne S. Montare and Eleanor Southers, Interview by Wells H. Anderson


For those of us of a certain generation, the prospect of retiring, and retiring well, is something we think about often as the hairs get grayer and our gait gets slower. Recently, Wells H. Anderson, a member of
GPSolo’s Editorial Board and a practice management consultant, sat down with a Midwestern sole practitioner* in the process of winding down his practice and asked him about his experiences in readying his practice to leave in the hands of others as he transitions from practicing attorney to being, with hope, happily retired. Here is his story.

As I came into my 60s, I started to think in earnest about my retirement. My father retired when he was about 66. From what I could tell, some of the happiest years my parents spent together were after my father retired. So, I started to think in those terms when I was a few years ahead of that age.

Forming a Plan

The first thing I needed to do was step back and do some long-term planning. I am a sole practitioner with a reasonably busy practice. For help, I have the equivalent of two full-time legal assistants. I recognized that I was so busy with the day-to-day stuff that I wasn’t attending to longer-term stuff. It was like the parable of the shoemaker’s children, who go barefoot because the shoemaker is too busy to make their shoes.

I had been making retirement plans in a general way, such as trying to save money in retirement accounts and the like, but I didn’t have a specific plan. A few years ago, I saw some information about a retirement planning seminar for lawyers that was put together by a practice management consulting firm. I decided it was time to take the plunge and get into the specifics of planning for retirement, so I signed up for a weekend seminar aimed at sole practitioners and small firm lawyers. I thought using a consulting firm was a good idea because, as they say, the lawyer who represents himself has a fool for a client. I hoped that having an independent third party review my practice and ask the right questions would accelerate the process. And that proved to be the case. Utilizing a consulting firm helped me clarify what I wanted to accomplish and what steps needed to be taken to get there.

What came into focus was that I was fortunate to have both long-term clients and long-term staff members, and I wanted to make sure that I did right by both groups. Many of my clients have become my friends. As for my staff, my most junior person has been with me for 19 years, and my most senior for 35 years.

There were three things that I wanted to accomplish with my retirement plan. First, I wanted to offer an option to my long-term clients of continued representation where I felt they would be taken care of competently by people who had their best interests at heart. Second, I wanted to give my long-term staff members an opportunity to continue servicing those clients. And third, I wanted to feel good about the timing and basis of the transition.

During this process, I met a prospective client whose story solidified the need for me to have a continuity plan for my clients. She had come from a small, adjacent town to interview me because her lawyer had just retired unexpectedly. She was very concerned that I had a plan for dealing with my own eventual retirement because she didn’t want to find herself again suddenly without a lawyer. I am happy to say that she became not only my client but a good friend. And I have noticed as my hair gets more salt-colored and less pepper as the time goes by that more of my clients are asking that sort of thing. I wanted to have a good answer.

So, the consulting firm did a deep dive into the business side of my practice, reviewing my revenues, number of referral sources, and that sort of thing. I worked with one of their business coaches to figure out where I wanted to take the practice and how and when I wanted to start wrapping things up. By this process, I realized that I wanted to phase out my practice over time and would like an of counsel relationship with a firm that could inherit my clients when I retired and give my staff members the option to stay on. This way, I would be bringing value to the firm in terms of the book of business I would leave behind when I retired. I wanted to ramp down the practice gradually rather than shifting from 60 miles an hour down to zero all at once.

My search for a firm narrowed down to two choices, the firm I chose and another one located farther away in a larger city that didn’t seem to be a good fit. I was already familiar with and had a lot of respect for the firm I chose and the work they did. Also, they had a younger lawyer come on board who was going to be working in the same practice areas as me. Not only did this lawyer have the time to take on some of my work, but his presence at the firm also provided me with the opportunity to work with and mentor this young lawyer, which I am really enjoying. So far, the transition to firm life has gone well, and the phase-down plan seems to be working.

Transitioning the Practice

Now that I have figured out what to do with my clients and staff, I still need to deal with all the administrative matters of transitioning my clients to the law firm, such as what to do with all my client matter files. My current plan is to leave the current file copies with the firm and keep an electronic copy of some of the more pertinent electronic records.

I also still need to communicate with my malpractice insurance provider to find out what kind of requirements they have regarding my client files. I qualify for tail coverage [extending the reporting period of malpractice insurance beyond the term of a claims-made policy] on a favorable basis, so I needed to be clear about my duties.

My agreement with my successor firm also requires them to preserve my records. Because many of my files have been converted to PDFs, I may take copies of many of them with me when I leave the firm, but I am still thinking through this part of the plan. I also need to think through what to do with the records I’ve had for a long time in my practice management system and the remaining paper records that have not been scanned. We will need to address whether old client records in my practice management system should be converted and imported into their system or whether they should be exported into some readily accessible formats such as spreadsheet data files and PDF files. For the paper records that have not been scanned, we need to decide whether it makes sense to continue with the conversion to PDF files or continue to retain them as paper records. With an estate planning practice it is not a simple matter of destroying all files after a certain number of years.

In terms of the physical arrangements, I have occupied space within the firm’s offices since January 2017, when I closed my own office. I’m shown as “of counsel” on their letterhead. I have my team there. We have two separate computer systems. I kept my system when I moved over because I feel like I’m an old dog and don’t want to learn too many new tricks. I use their client management system for active clients while retaining access to my old system.

One of the things I did before the move was to send a letter to my referral sources to let them know what my plans were, and then, after a little time, I sent a notice to my clients of my move. My preferred timetable is to stay at the firm for two years. The idea is that I’m affiliated with the firm the first year, practice the next year, and fully retire at the end of two years.

To test how well my plan would work, I took a three-week trip to Alaska with my wife and my brother. We tried to set things up to see how the practice would be covered while I was gone. That worked out very well. We prepared for it, and I warned my clients in advance so that they wouldn’t be surprised when they contacted the firm and I wasn’t there. I was pleased with how well things worked in my absence. It gives me encouragement to think that my plan will work well. After my “test run,” I decided to drop down to working four days a week. So far that is working well, and I’m pleased with it.

Adjusting to the Change

Of course, none of this was done without doubts and regrets. We called my office “home” for something north of 25 years. It was a big change for me and my staff. There were things about the old space that we cannot duplicate in the new space. We did give some thought to the significant challenges up front with the help of the new firm. I feel that we got the most important concepts of space transferred over in terms of proximity between us as a team. There are also some surprise benefits that came with it, such as the camaraderie that has developed between my team and some of the firm’s team who have reached out to us and really made us feel welcome. Additionally, there is a good energy level in the office. I’m very pleased with that as well.

While it was disruptive to leave our home, it was made easier by the fact that we had an advance plan. I am not as young as I once was, so I hired people to do the physical parts of the move, which was accomplished with a minimum amount of disruption to our ability to provide services. Again, I was very pleased overall with how it went.

One big concern I had with retiring in general was whether I could afford to do it. I guess I won’t really know until I’ve fully retired. However, I met with an independent financial planning firm as part of the process. I’ve been consistently putting money into my retirement accounts, and I tried to get an idea of what our personal expenses are going to be. We’ve crunched the numbers and they look realistic.

Our children are grown, and college educations are over. We’re hopeful that we can do this, but one of the things that’s helped me gain more confidence is having what we call a “dress rehearsal.” This upcoming year we are going to try and live on the amounts that the financial people projected would be coming in from Social Security, the retirement payments from my wife’s former job, and a reasonable distribution from the retirement account. This past year we figured out how much we should need, and this year we are going to live off that and see how it works. We want to do some traveling, but we will budget for that based on our projected retirement income rather than what my practice income has been. That’s been a good goal but also a challenging experiment. One of the things I’ve done is to have my wife take a more direct role in the finances because she makes more of the day-to-day spending decisions than I do. She now is directly in control of spending and getting the monthly credit card statements and handling all that. It’s just a little bit of a recalibration of our division of the financial roles and trying to do a rehearsal to see where the challenges might be before we run into them. I do a lot of estate planning for clients, so I have been on the fringes of this kind of challenge, but not to the level that a true financial planner would be. So, we had somebody help us with this and will see how the dress rehearsal goes.

While we are facing a lot of unknowns going into retirement, the one thing I know for sure is that we’re going to have more free time. I anticipate that my wife and I will probably be creative and figure out more ways to spend money when we’re both retired. I feel that if we both know where we are financially, then we can make yay or nay decisions based on that. It’s what we’ve done our whole lives, and so far, it’s worked great. The main difference is that we won’t be borrowing money for big purchases like we did when we were younger.

Hopefully some of these ideas and experiences will be food for thought for those of you about to take this big leap.

Ariadne S. Montare

Ariadne S. Montare is a consumer law and bankruptcy attorney in upstate New York, where she helps clients facing financial challenges such as debt and judgments.

Eleanor Southers

Eleanor Southers, owner of Professional Legal Coaching, coaches attorneys nationwide who want greater success and fulfillment in their careers.

Wells H. Anderson

Wells H. Anderson, JD, is a legal technology consultant who works with small firms and solo attorneys as the owner of Active Practice LLC and SecureMyFirm.