Step 1 – Winding Down Your Life’s Work
I worked for thirteen years as a Practice Management Advisor with the New York State Bar Association. My role was primarily in developing Law Practice Management programs for solo and small firm practitioners, young lawyers looking to get started, and mid-sized law firms looking to develop Succession plans. I always knew that walking away from a law practice would never be easy, but I was surprised to find out how difficult it was for sole practitioners who have been working in the trenches for 30+ years. Retirement was the topic you very rarely heard discussed in bar meetings. When I tried to raise the topic for exit planning, many lawyers would say, “My exit strategy is to die at my desk!”
In 2003, after my own transitioning away from my life’s work with the NYSBA community, I took time off to help a family member who was struggling with early-onset Alzheimer’s, a serious life transition if ever there was such. I returned to teaching at a local university, while completing a second master’s degree in Coaching. I stayed active in bar activities through my writings about the Aging Workforce and its impact on the legal profession. I now find myself increasingly trying to convince baby boomer lawyers to start working on their own exit plans.
Managing Law Firm Transition
Today, many law firms throughout the US and Canada have a significant proportion of baby boomer aged partners that control a significant proportion of their law firm’s clients and revenues. For many law firms, their future success—and even survival—may depend on how they manage the transition of clients and revenue to the next generation of owners. At this same time, a particularly large number of sole practitioners, who have invested a lifetime into making their business a success, are only now started to think about life’s next steps – both in terms of the future of their business and in terms of the individual’s new outlook to living.
The sheer number of baby boomers born between the years 1946 and 1964 are in the process of changing the traditional demographic shape of our society. The traditional meaning of retirement has always been a single event – “withdrawal” from the workforce into leisure, relaxation, a slide into the end of life.
With 10,000 Americans turning 65 years of age every day, it is time for lawyers and the legal profession itself to stop viewing retirement as an end-point in itself, but rather to begin thinking of retirement as a series of developmental steps taken by individuals over an extended period of time. The legal profession not only needs to redefine the meaning of retirement, it needs to re-examine the whole notion of aging.
Many attorneys are finally beginning to embrace the idea of living longer, living better, and maintaining a more balanced, vital lifestyle. This is important, because the profession has always prioritized the interests of clients over self – for all the right reasons. However, little has been written that teaches lawyers, “In the event of emergency, put your oxygen mask on first.”
Profession in Crisis
I believe Aging of the profession has created “an emergency” condition within the profession. The survival of the profession itself may depend on how the profession and individual lawyers respond to this emergency. Change will be particularly difficult for people in a work culture that believes that change should be slow, risks avoided, stability is best, and the past is a good source of information about how to approach the future. I have been told that lawyers are particularly susceptible to looking toward the past to predict the future.
I recently asked a friend who is a sole practitioner what he saw as the most pressing concerns for the profession regarding the aging workforce. My friend has been practicing law for Forty-years in upstate New York. Without hesitation, he said that he believes, “The single greatest challenge to the profession is the number of senior lawyers who actually cannot or will not retire.” Over the past thirty to forty-years, the number of solo and small firms have expanded to meet market demands, and today, many of these same practitioners find themselves unable to retire and still maintain anything even close to their current standard of living.”
He went on to say that, “All of the existing retirement/transition materials assume practitioners have ample resources for voluntary retirement to take place,” He suggests that, “Just surviving this transition into retirement is going to be the biggest challenge for many aging lawyers and the legal profession as a whole.” He went on to caution that, “We could be seeing large numbers of 70-year-olds who can’t support themselves if they retire.” He says that, “It could get ugly, especially with pressure from ‘kids’ graduating with several hundred dollars in school loans to pay back, who are willing to work for much less than experienced counsel.”
Perhaps you’re among this group of baby boomer lawyers who are beginning to think about slowing down, or possibly beginning to think about retirement. Maybe you need to close up shop due to your appointment to a judgeship. Or, perhaps you just want to have a plan in place should the unexpected occur and you have to leave owing to an illness or other personal situation. Whatever the reason, it is better to have a plan in place well in advance of actually closing the doors.
I’d like to offer some orderly steps for solo practitioners to consider to help with the “how’s” and “when’s” of closing their office doors.
How Can I Get Started? – Put First Things First
Most lawyers I’ve worked with take at least 6 months to a year to decide to begin winding-down a law practice. What usually happens is individuals decide to begin eliminating practice areas. They just do not take on any new work in selected practice areas. Litigation is one of the first to go with its uncertain scheduling and stress. Family practice is another area that gets outsourced pretty quickly.
During this period of time, no mention of retirement is made for fear that you wouldn’t be able to bring in new clients, and clients are still needed to pay the bills. Without a firm decision on when you wish to close the office, there certainly is a need to keep the lights on. There also is the fear that other local practitioners would find out and they might start eating your lunch.
When should I go public with my plans?
First, it is important to sit down with your spouse, law partners, and trusted friends to help you explore the idea of winding-down the practice. As you plan for this life transitions it’s always helpful to share ideas and explore possibilities with others.
Next, when a decision is made you want to inform your trusted staff. You will need their assistance both in building your plan and in implementing it. But beyond that, staff members deserve to know your intentions—after, that is, you have answers to the obvious questions, such as when you will begin winding down the practice. Assure them that they are trusted and valuable with job security until a date certain. Ascertain if any have plans for retiring in the near future.
Expand your inner circle to include other lawyers who may wish be able to help you wind down your caseload or they may be interested in hiring your staff. Prepare to contact local bar colleagues who work in your area to make potential hiring contacts when the time comes.
Long-term clients deserve to hear about your plans in person or at least by telephone. However, think carefully about how and when you describe your plans to clients. Be sure to know the status of all of your matters so you’ll be able to answer clients’ questions, especially concerning how your plans.
I’ll follow-up on building a timeline in my next article.
Stephen P. Gallagher