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Top 5 ways to make sure your clients pay their bills on time

Law firms can’t operate unless there’s enough money coming in to keep the lights on. As a lawyer you’re working hard for your clients because you’ve taken an oath to and because you get paid to do so. Clients sometimes either cannot pay their bills, or many times, they decide they don’t need to once you’ve already done the work. So, how many of you don’t get paid on time? How many of you don’t ever get paid at all?

If you’re one of the many not getting the money you earned, here are the top 5 ways to make sure that the money you earn actually finds its way to your firm’s bank account.

1. Put your fees in writing

This may seem obvious to most lawyers who live by the mantra “put it in writing”, but sometimes obvious isn’t enough. Whenever you start representing a client always make sure to have an Engagement Letter in place that clearly outlines the scope of work you’ll be performing as well as the fees that are associated with this work.  Whether you’re charging a fixed fee, hourly rate, or some other combination, there’s no substitute for transparent pricing that’s in writing.

Engagement letters act as a way to both protect you from liability as well as get you paid. These documents give you the right to sue in the event a client doesn’t pay their bills. If you sue on an engagement letter the big problem is you’ll be suing on a breach of contact action which can take a long time. By the time discovery proceedings alone are finished you may be months down the road. If you make your fees clear, unequivocal and make sure there are no conditions attached to your right to receive the fees you may have an easier time collecting. Another way to compliment your engagement letter is by adding on a Promissory Note.

2. Put a simple Promissory Note in place

While engagement letters may take a while to process in court, Promissory Notes should be quite quick. The difference with a promissory note is that, unlike your engagement letter, it’s exclusively an instrument for the payment of money. As such, it can act as an exhibit in an expedited summary proceeding (for instance, check out CPLR 3213 in New York).  So long as you can show there’s no issue of fact you’d file this motion and avoid other proceedings and drastically streamline the process to getting paid. That’s why you do a promissory note as well as the engagement letter.

In many states you can bring a summary action on a promissory note that will give you an expedited judgement. You may not have the money in your hand, but you’ll at least have something you can use to get a garnishment or a lien. You’ve protected your fee this way.

A promissory note may not be enough though. Even though it wasn’t taught in law school, you’ve of course heard that possession is in fact 9/10ths of the law. So, make sure you also get as much money up front as you can.

3. Get a retainer

It’s pretty customary to take money up front as a down payment of sorts. In general, there are two types of retainers you can collect. A Minimum Fee Retainer and an Advance Retainer.

With a Minimum Fee Retainer you take a certain minimum so long as you’ve done the work. Even if the case is concluded quickly this is the fee you’re permitted to retain.

With an Advance Retainer, on the other hand, you put that money into escrow and as you earn it you’re entitled to draw on the retainer. It acts as a security fund for you being paid.

Which one should you require? Probably both. As an example, let’s say you have a divorce action and you take a Minimum Fee Retainer and it takes you less time to do the divorce then you anticipated; this means you’re allowed to keep that entire sum. If it takes you longer, though, you’d start charging hourly. That’s why you’d also have an Advance Retainer of an additional amount. Once you complete the amount of work for the Minimum Fee Retainer you can start drawing down on that additional Advance Retainer. If you don’t do that additional amount of work, the remaining balance needs to go back to the client. Again, this assumes you’re charging hourly, and not a fixed fee.

Be careful not to over-quote though! Your clients won’t be happy with you if you try to take a larger retainer than absolutely necessary. Not only will you damage your reputation but you may lose out on additional work in the future.

At the end of the day, if your retainers don’t bring in enough to make you comfortable, put a simple promissory note in place to cover the balance.

4. Take credit card payments

Why wouldn’t you? It may be a more expensive way to collect payments since there may be as much as a 3% charge — but that’s a small price to pay for getting the other 97% on time, hassle-free. I don’t need to tell you how much 100% of $0 is.

Clients also like the convenience of being able to pay you in the way that’s best for them, and accepting credit cards can be a great benefit of choosing your services over those of another attorney.

There are even some new, easy, and less expensive solutions out there such as Square that have lower rates and are easy to implement. So stop being afraid to go electronic.

5. Accept post dated checks

Afraid of the credit card (despite our rant) or have clients that don’t have one? You can always get a post dated check. This may not be allowed in all jurisdictions but it’s well worth it if your jurisdiction does. With a post dated check, many states will allow you to treat it the same as a promissory note (see above) and you can fast track your payments.


6. Do a good job and be crystal clear on your expectations!

At the end of the day, there’s no substitute for having a good relationship with your client and doing a great job for them. If they have the money, you have a good relationship, and the billing has been clear and transparent from the first day they came into your office you will avoid a lot of headaches in the future.

Do you have any other tips for getting paid? Let us hear them in the comments below.


  1. I think this is good advice. I use Square and it couldn’t be easier.

  2. Jay Pinkert says:

    Don’t forget Paypal.