Going Solo: 4 Unexpected Expenses

There are known knowns. These are things we know that we know. There are known unknowns. That is to say, there are things that we know we don’t know. But there are also unknown unknowns. There are things we don’t know we don’t know. – Don Rumsfeld

Going solo?

When you start a law firm for the first time, one of the hardest things to get a handle on in the planning phase of your firm is your monthly expenses. What’s this going to cost? How much do I have to make in order to bring money home?

When you start your law firm there are going to be a lot of expenses that fall squarely into the “things we know that we know” bucket. You are going to know a lot of your expenses. For example, you’re going to know your rent is $______ or your phone service is $_______. These are easy numbers to know.

Then there is “there are things that we know we don’t know” bucket. You don’t know how much paper you are going to use in a month. You don’t know how many times the shredding service is going to come. There are many of these kinds of expenses. But most of them are of the small variety assuming you are a solo or small firm.

The last category is the killer. It is the unexpected bill. These are bills that take you from having a great month to breaking even – the “unknown unknowns”.

In this post, I’ll share with you some unknown unknowns of the early part of my practice. Plan for these four expenses:

1.  Deposit For Electricity

Both times, I’ve opened accounts for electricity, my provider has required me to pay a 6 week estimate of usage as a deposit. A deposit that is refunable after a year of on time payments. Last week, I cut a check for $600 for my deposit.

2.  Commercial Eletricity Can Be Spendy

It is hard to make any blanket statement about electrical rates. But I’ve paid significantly more for commercial rates than I have for residential rates in the same area. Check with your supplier before opening. See what the difference is in price per kwh. It can add up. The first commercial electricity bill that I received was shocking.

3. Malpractice Premium Jump

When you first hang your shingle, malpractice premiums are relatively low. They are a claims made policy and the world of possible claims is small. Between years 1 and 2 of my practice my premium jumped 35%. I had planned for a 5 to 10% jump.  Speak with your broker about this. Plan for it throughout the year. It is much easier to save a little every month than get hit with a large bill all at once.

4.  Sponsorship Expenses

Local businesses sponsor all sorts of things and you will too. When you start you’ll be out and about. Meeting all sorts of folks. You need to do this. It is vital to the success of your business.

But maybe even before your first fee comes in, you’ll get asked to sponsor something. It will be some worthy cause put forth by some worthy contact. You’ll feel bad not doing it.

My advice on this is to pick one cause and focus your sponsorship on that cause. At McKeen Law Firm, our biggest sponsorships are to “The Race To Fill The Pantry” and “Achilles CT“. For every other cause, I basically buy the small ad in the program.

There’s no right answer but have some plan to deal with this pressure. When you are starting out $250 here and $500 there really adds up.



Ryan McKeen is A Connecticut Attorney. He can be reached at (860) 471-8333



Starting A Law Firm? You Need A Supplier

Opening and running your own practice involves a lot of things. One of those things is buying stuff. The stuff you need to run your show. Stuff like pens, paperclips, coffee, and tape.

Anything that saves you time and money – makes you money.

One of the best things that I’ve done for my practice in this respect is getting a WB Mason account. They offer same day delivery in most cases at prices lower than major office supply stores and Amazon.

Getting what I need quickly and inexpensively means more time to focus on what matters – family and clients.

I get nothing for this post. I’m not paid by WB Mason. This is a post that I wish I had read years ago. So I wrote it.

Starting A Law Firm? Buy More of These 3 Things

When starting a law firm, you’ll face challenges large and small. This post focuses on 3 overcoming of the smaller challenges. Spending your money in these 3 areas can save you money, time, and embarrassment.

1.  Toner. Our office is paper-less. However, we still print things. You will too. Toner can be very expensive. Not having toner can be more expensive. You’ll never know when they will run out (even with your printer and computer monitoring toner levels). Safe bet is they will run out when you most need it. Always keep 2 additional toner cartridges on site.

2. Stamps. Like toner you’re likely to run out at exactly the wrong time. Getting a postage machine can be very expensive. And at the outset is probably not the best use of your funds. Get a Stamps.com account. Order postage labels in advance (get plenty of them). Never worry about running out of postage or having to go to the post office when your pressed for time again.

3. Memory. Invest in thy hard drive. Last year, I had to sell my Macbook Air and buy a new one. There was nothing wrong with my Macbook Air. It worked fine. What happened is my hard drive filled up.  Law is a data intensive line of work. When I started out, I purchased the Macbook air with the smallest hard drive. 18 months later it was completely inadequate. Your practice will grow make sure your hard drive can grow along with it.

These are 3 of the smaller lessons that I’ve learned in starting my own practice. Especially when you’re starting out, its hard to figure out where to spend money. Buy extra toner, postage labels from Stamps.com, and more memory. You won’t ever regret doing so.

McKeen Law Firm is A Connecticut Law Firm.


Starting a Law Firm…How Much Should I Spend On Web Marketing?

This post is written for folks starting a firm on a tight budget. That’s more folks. If you have a trust fund, a massive existing client base, or like to light money on fire – please stop reading this post.


We live in the age of Uber and Amazon delivering goods within one hour. The web has transformed life.

Think getting a piece of this pie is essential to your new firm? As of right now it’s not.

Web advertising can be very expensive. It has to be to either get in front of the audience you want to be in front of or for market saturation. There are lawyers out there in whatever area who can and will outspend you. Money talks.

My advice is to build your web presence over time. It is very important. I’ve done a lot online. I rely on the internet for roughly 15% of my new business. Perhaps I’m doing it wrong but I don’t think so – I’ll get into this in another post.

The first thing you should do is learn WordPress. Head over to WordPress.com, buy your domain, some hosting, and pick out a theme. The total cost for a professional theme, a year of hosting, and domain registration will run you approximately $250.

From there, get to work. WordPress is fairly easy to use but be prepared for a lot of trial and error. Every six months or so I spend a full day tweaking my sites. Sometimes the improvements are small and other times they are substantial.

In addition to this site, I have created www.mckeenlawfirm.com and more recently www.ctrealestatelawfirm.com.  Both sites were done by me without technical or graphical assistance.

The first rule of starting a practice is to: Keep. Overhead. Low.

Don’t be a voice in the crowd. Don’t dump thousands of dollars into online marketing and a website. Focus on networking, building client base, doing good work, and generating revenue. As you grow, re-invest in infrastructure including an expanded web presence.

Using A Smart Watch in Your Law Practice

Apple’s Watch is going to be a hit. A big hit.

You see, smart watches are old news to us Android fans. I’ve been using a Moto 360 for 5 months.  I love it.

Moto 360
Moto 360

The first thing about a smart watch is that it is a complimentary device. It replaces nothing. It will not replace your smart phone. It’s usefulness is extremely limited. For almost every task, your phone is going to be your go-to device.

For most of the day, my Moto 360 has a blank screen. This is fine. There’s no need to display something I’m not looking at.

If a smart watch isn’t going to replace your phone, why get one?

The answer is that it is a fantastic complimentary device. I don’t receive all messages on my watch. I receive priority messages from contacts. Listserv chatter can wait. My wife telling me I have to pick up a sick kid from school – can’t.

Parts of my week are spent in meetings, in court, and at depositions. Places and times where it would be rude to check my phone. I won’t take my phone out of my suit pocket in court. But I will glance at my watch.

The ability to quickly respond to messages with voice from one’s wrist is really useful.

I also regularly set reminders using my watch. Things like “remind me to send a check to so and so when I get to work”. When I walk into my office the watch vibrates slightly and reminds me to cut the check.

It’s also useful for traveling. It regularly alerts me to traffic accidents or heavy traffic and suggests alternate routes. It also alerts me as to when I need to leave to be at a destination in time.

At the airport it tells me my gate, whether or not my flight is on time, and the weather in the city I’m going to.

The downside is that you are always connected. You receive that message from a client instantly. You really feel like you’re always on.

If you’re considering a smart watch you should understand it is a complimentary device. It is cool. It can be useful. But by and large it is a luxury item as opposed to the necessity that has become the smart phone.

If you’re on a tight budget, I wouldn’t buy one. If you’ve had a good month and you’re a gadget guy or gal – buy one.

Starting a Law Firm? Your Second Legal Malpractice Premium

You’ve made it. You’re nearing the end of that all important first year in business. You’re a success. Things have gone better than you’d hoped.

You know your monthly expenses. Every month you’re working within your budget. You’re able to anticipate bills.

Your legal malpractice premium is going to come due on your first anniversary. Happy Anniversary!

My second year premium jumped 30% over the premium I paid the first year I was in business. Virtually nothing had changed on my application other than I was in business for a year.

The price increase felt significant. I hadn’t budgeted for this. After talking with my agent, this kind of jump in premiums in common.

Be prepared for this anniversary gift.

Starting A Law Firm? What To Do First

You’ve identified the dangers. You’ve deployed Revis Island level coverage to neutralize them. The dangers aren’t getting you.

You’ve even walked through some spiderwebs.

It’s now time to put your plan into action. You’re faced with a problem that I call “everything has to happen simultaneously but can’t”.

Folks often ask, where do I start? The question invariably involves entity formation, bank accounts, and funding. The only way to tackle a problem like this is one step at a time.

Here’s a question, a budding solo asked me:

Do I file the paperwork for the LLC before anything else? If so, how do I pay for those charges without using my personal bank/funds?

If I start the business bank account first so I can capitalize in order to pay necessary start up costs, how do I open that account as an LLC business account without having filed the LLC forms and without a business address?

Do I sign the lease for my office space as a personal debt so I can get an address/PO Box and then get the bank account and then file the LLC paperwork ?

Not sure the proper timeline to proceed in. Any advice is much appreciated.

Been there. Here’s what you’re going to do:

1. File your incorpration paperwork.

2. Once you are incorporated get a FEIN from the IRS. This is easily done online. Takes about 10 minutes to do.

3.  Once you have your certificate of existence and FEIN head to a bank and open an operating account and any IOLTA accounts that you need. Bring these documents with you. Fund the account and pay expenses from the account as soon as possible. Here’s a post on the nuances of opening law firm bank accounts. 

4. Of course, you’ll have to advance costs to start the company from other funds (including personal funds). There is no problem doing this. Just account for them. This can be done via spreadsheet or in quickbooks. Save receipts. But the sooner you create and fund your business account the better simply for accounting purposes.

5.  If your landlord will lease to your company then sign on behalf of your company. Many landlords will require you to sign a personal guarantee. When you’re starting up, you as a member are going to have to personally guarantee most if not all debt.

Follow these steps and you’ll be good. Anything else and “that dog won’t hunt”.

Starting A Law Firm? The First Challenge

It is January of 2012. I’m sitting outside. It’s warm outside. The breeze is cool. All is quiet except for the waves crashing on the beach. The air smells of salt. You know that smell. The beach smell.

In my hands is my Kindle. I’m in the Bahamas. My cell phone doesn’t get signal in the Bahamas. Wifi is sporadic. I’m alone with my thoughts. I’m reading the Steve Jobs Biography by Walter Isaacson.

Vacation is giving me the distance to examine my life. The Jobs Biography is inspiring me to change my life.

I’m confronted with the question of what’s holding me back? I’m 31 years old. I’ve created a conservative and comfortable world for myself.

As I sit there on that beautiful night with the lights of Atlantis across the bay I chew on this question.  I struggle mightily with this question.

All of my other answers are non-satisfactory. Amounting to nothing more than political dialogue in my head. I’m telling myself things I want to hear. Things that keep me in place. Things like “I like where I am and I’d be sad to leave.” Things like “I’m lucky to have a job.”

Sitting there that night, self employment looked a lot like unemployment.

It’s not the ideas – I have them. I have definite ideas on how I can improve my practice and better serve. I even have ways that I think I can execute on those ideas.

I decide to be honest with myself.

I’m fearful.

The fear takes many forms. The fear that I’ll fail. The fear that I’ll end up bankrupt. The fear that I won’t provide for my child. The fear that I’ll lose the respect of my friends and colleagues.  The list of fears is long. Endless spiderwebs.

Danger is completely different than the fear. Danger can actually ruin you. Fear is what keeps you in place. The thing that keeps you from experiencing life in its fullest.

One danger is taxes. The IRS can destroy you.  However, the danger can be mitigated through work and planning. I know nothing about accounting software. I can learn it or I can hire someone to manage this task for me. Through preparation my taxes can be done properly.

If you’re thinking of starting a firm the very first thing you must do is separate your fears from real danger.

This winter I’ve made some bold decisions to grow and improve my firm. I’m working on McKeen Law Firm 4.0. And I have to tell you, the fear doesn’t go away. It just changes. Spiderwebs abound. It’s part of the deal.

If you haven’t seen this video, watch it:

Hadfield is brilliant. To overcome one’s fear of spiderwebs one has to identify what’s really a harmful spider and then walk through spiderwebs. Very few spiderwebs are dangerous at all. Certainly not the ones you can walk through.

At our firm, when fear sets in and it does, we remind each other that “we’re walking through spider webs”.

Over the last three years, the single common denominator in all of my worst decisions has been fear. More specifically failing to identify fear and instead reacting to it as danger.

If you are thinking of starting a firm. Step one is identifying your “spiderwebs”. Step 2 is walking through those spiderwebs. If you’re thinking of sustaining a firm, Step 3 is repeating Steps 1 and 2.

There’s no secret. Just “constantly walk through spider webs”.

Starting A Law Firm: How To Open Bank Accounts

I have always been afraid of banks. ~ Andrew Jackson

The first time I experienced how difficult starting a law firm is happened in a bank. Actually it happened in a bank for four and a half hours. And then in another bank for another four hours.

Our first bank gave me a Real Estate Brokers Account. We are not real estate brokers. They also promised that checks were free. They then charged us $100 from checks and took the money out of our IOLTA account (which didn’t have any money in it). This caused the IOLTA account to be overdrawn. At 5:30 on a Friday morning I was sending an email to the Statewide Grievance Committee explaining what had happened. After several phone calls with the bank, they corrected their mistake. We switched banks a month later.

Dealing with banks taught me the first law of managing a firm: Everything takes forever.

Welcome to Bankland.


If you are starting a firm you’ll likely decide to form some sort of liability limiting entity (pick’em: LLC, LLP, PC. S-Corp). Before you can obtain a bank account for your entity you must first create the entity and properly register it with the Secretary of State. Then you must obtain a federal tax identification number from the IRS. You will need both of those things prior to walking into a bank.

You’re also going to need a firm juris number. You must get that number from the Statewide Grievance Committee.

Getting what you need to open your bank accounts can easily take two weeks. Plan for this.


First you’re going to need to bring money to the bank. Banks have minimum deposits required to open accounts. Find out what that amount is and make sure you have it. Also make sure you have at least two forms of identification (e.g. driver’s license and passport) and a certified copy of your articles of organization.

At a minimum you are going to need two accounts. Your first account is your operating account. The second account is your client’s trust account (IOLTA). You should get different colored checks for each account. One cannot violate the first rule of attorney ethics: Thy client’s funds account is sacred. You can’t violate that by mistake. You can’t violate that even for one second.

On the advise of a very wise law firm bookkeeper, we optedy for a second IOLTA account. We use our second IOLTA account solely for real estate transactions. In real estate transactions, large amounts of money come into the account for very brief periods of time. Having a second account solely for real estate makes reconciling our normal IOLTA account easier. We use green checks for our real estate trust account. Green for grass. The kind you mow.

Extra Points:

Strongly consider getting a credit card with a small limit. Our bank was willing to open small credit accounts in the name of our business. We use these cards to pay all of our monthly subscriptions and for firm expenses. It is an accounting efficiency for us. We look at our credit card statements and then make entries into quickbooks. This allows us to write one check a month for the majority of our expenses.

A small limit will also help you live within your means.  Early in your business life cycle it may be tempting to lean on the card heavily. A small limit on a credit card that you can pay off every month is perfect. You can also earn points.

We love our mobile banking. We’re able to deposit checks to our operating accounts directly from our phones. This saves us trips to the bank. Really investigate your bank’s mobile and online features. Depositing checks without having to go to a bank saves time.

Post Game Analysis: 

Your bank, your bank accounts, and the ways in which you interact with your bank are critical to your existence as a law firm. Ask lawyers in your area what bank they use and if they are happy with their bank.

And plan to be in the bank for four hours. And if you are forming a partnership – it’s likely all of the partners must be at the bank – likely for four hours. That’s after it’s taken you two weeks to form your entity, get your tax id, and obtain a firm juris number.


McKeen Law Firm is a Glastonbury law firm that litigates difficult cases, closes real estate deals, and serves as trusted advisors to individuals and small businesses.