Why You Should Be Charging Your Clients Affordable Premium Fees
The following is adapted from The New Law
Business Model-Revealed: Build a Lucrative Law Practice the You (And Your Clients) Love, written by Ali Katz, New Law Business Model Founder and CEO, that forms the basis of our program.
Have you ever purchased a piece of art for your home or your office? If you have, consider what you spent on the artwork. Heck, consider what you spent on just the frame!
Was it a lot? Was it worth it? If you answered “yes” to both of those questions, you understand that people are willing—even happy—to pay premium prices for something that brings them joy or prestige, or even for something that is simply beautiful.
Now imagine what those same people will pay for services that bring security to their families, and that offer them real peace of mind.
As a lawyer, your legal services can give people that kind of personal security, and when you can deliver real results, your clients will be happy to pay. But, you can only deliver real results if you are charging properly, and that means premium fees, as compared to what the other lawyers in your community charge. The best part is, you can do just that while remaining the most affordable solution possible for your clients.
If you’re one of those lawyers who undercharge and cannot deliver a truly meaningful service as a result, I’m speaking directly to you: You don’t have to participate in the “race to the bottom” mentality of offering your services at a discount just to get clients in the door, or compete with the online DIY services that are springing up everywhere. In fact, if you do, you’re doing yourself and your clients a disservice.
The Affordability Paradox
It may seem paradoxical to charge premium fees and still be the most affordable solution for your clients. That’s why, at New Law Business Model, we call it the affordability paradox. When you understand and leverage the affordability paradox, you can confidently charge premium fees for the high-value outcome you provide, and still be the most affordable solution out there. How? By only providing your services to people who truly need the high-value outcome you provide, and by helping them choose the right fee to receive the right outcome from you.
By leveraging the affordability paradox, you can command the fees you need, have the life and law practice you want, and at the same time deliver the highest quality service. By doing so, you provide the highest and best outcomes for your clients, saving them time and money. As a result, hiring you is the most affordable solution for your clients’ needs.
Educating your clients to make informed and empowered choices when it comes to hiring you is imperative here. Otherwise, your clients have no basis on which to make their hiring decisions, other than by comparing prices between you and the lawyer down the street.
I figured this one out the hard way when I was once hired by a client for a $5,500 fee, only to have them cancel two weeks later when they thought they’d found the same plan for just $2,500. I almost threw in the towel on my law practice then and there.
From this painful (and expensive) experience, I was able to see that my clients had no way to choose among their different planning options other than based on price, and that it was my job to create a process that would guide them to understand the various options for their family, and the impact of their choices, so they could make educated and informed decisions based on outcomes they wanted, not just the price of their documents.
The Importance of the Family Wealth Planning Session
So I asked for help, and got it—for a $20,000 investment with the best consultants I could find on pricing and packaging of professional services—and I developed a system for educating my prospects to become clients, and choose their own fee along the way. On the advice of my consultants, I stopped offering a free meet and greet consultation and instead created the Family Wealth Planning Session process, an initial meeting structure and fee quoting system that is now at the heart of the New Law Business Model. The lawyers using the Family Wealth Planning Session process engage nearly 100% of their clients (many have a 100% engagement rate) at fees ranging between $3,000–$6,000 on average, but in all cases, the clients choose their own fee!
The Family Wealth Planning Session (and the process that comes before it) are designed to guide prospects to understand their planning options and choose their own fee, at the intersection of the outcomes they want for their family and the budget they have to pay for planning.
The very first time I used the Family Wealth Planning Session, it paid off! After forty-five minutes together, my prospective client told me he was ready to move forward; then and there in my office, he chose his fee, and over the next hour we designed his plan, signed the engagement letter, and I collected payment. I was elated. Prior to that, I had often spent up to four hours with prospects, only to hear, “I have to think about it” or “We’ll need to get back to you.” Which they never did.
How It Works
Being able to charge affordable premium fees begins with an effective intake process that educates your prospects before they ever book an appointment to meet with you. Your intake process should include education that properly prepares your prospect for their initial meeting with you.
This preparation could be a short phone conversation with you or your intake team member. Some of our lawyers even require their prospects to attend an educational presentation before coming in to meet with them for the first time. Of course, if you do require a presentation first, you need to make sure the presentation is so clear that those who see it are ready to get on your calendar and take their next steps. Otherwise, they will get educated by you and then hire someone else. We call this marketing for your competition, and you definitely don’t want to do that!
Once your intake process has properly qualified your prospect and they have decided to book an initial meeting with you, they must complete pre-meeting homework. This homework will begin to help them even before they’ve hired you, immediately establishing you as a trusted advisor. It will also help you to help them to make wise choices during the initial meeting.
As for the initial meeting itself, it’s not your typical meet and greet or “free initial consultation.” Rather, it’s a valuable working session that has a name, a purpose, and a value. And, it does need to be valuable.
This is why our Personal Family Lawyer members (these are lawyers who have been trained in the New Law Business Model way of serving families and are licensed to use our resources in their own practices) call their initial meeting a Family Wealth Planning Session, or a Life and Legacy Planning Session, both trademarked terms—so please don’t use them unless you’re licensed by us. The name cements the meeting’s purpose: to look at everything they have, and everyone they love, and to create a plan that will keep their loved ones out of court and conflict when something happens to them.
This meeting is not a free consultation. It’s a 2-hour working meeting, and it’s not free. In our case, the Family Wealth Planning Session is $750. Your meeting needs to have a name, a purpose, and a value + homework that needs to be completed ahead of time. Then, you can give people plenty of ways to get that session for free, but only if they commit to submitting their homework ahead of time.
We have a similar structure for lawyers working with business owner clients. And, we’ve supported lawyers to create similar structures in their personal injury, bankruptcy, divorce, and immigration practices. The key here is that there is a system, a structure, pre-education, and clear boundaries. Your prospects don’t just get to schedule with you at no charge, and with no pre-work on their part upfront.
What Happens in the Meeting?
Once the pre-educated and prepared prospect comes in, they are taken through a working session focused on them, the outcomes they desire, and how you can help them achieve their desired outcomes. We never tell our clients what to do, but help them decide what they want to do, and then support them to choose the right path -- and fee -- to get there, with our support. Sometimes that fee will be $2,000, sometimes it will be $4,000, sometimes it will be $6,000 or more … but here’s the key, the client is choosing their own fee, based on their needs and desires.
Using this structure, our Personal Family Lawyer and Family Business Lawyer members often have a 100 percent engagement rate, at average fees in the $4,000 range. How can they command such high fees when people can go online and do estate planning for under $150 or hire another lawyer in their town for $1,200 to prepare a will and trust?
Because our members use the Family Wealth Planning Session process, become trusted advisors to their clients right from the very first interaction they have, and are leveraging the affordability paradox to help their clients choose the right planning option for their family or business.
As a result, our lawyer members can map out exactly how many two-hour Family Wealth Planning Sessions they need to have each month to meet their own personal time and money goals, and deliver on a truly meaningful legal service. This is the foundation to you having a life and law practice you truly love.
If you aren’t charging enough, or aren’t engaging every person you talk with who needs your services, it’s hard to build a business that truly serves the people in your community. And, who wants to hire a lawyer who is the discount option? Probably not the clients you’d actually love to serve. So, make this change and watch your life and law practice change in turn.
For more advice on the advantage of charging affordable premium fees, you can find The New Law Business Model book on Amazon.