by Tim Lemieux

One of the most downloaded resources each year on practicePRO.ca is our Sample Budget Spreadsheet for law firms. It was created as a supplement to our Managing the Finances of your Practice booklet. A budget is an essential part of any business financial plan, but many lawyers going into business on their own for the first time find that this isn’t something that law school prepared them for.

Your budget should include all expenses that you know of and/or can anticipate, and when they must be paid. Include an amount for unexpected expenses, since it is Murphy’s Law that costs will always be greater than you expect, particularly as the volume of work increases. Build in marketing time and expenses. Most of all, build in your draw: If you don’t look after yourself, no one else will. Compare the total expenses to your anticipated revenue.

If you do not have an historical basis to forecast income, make an educated estimate based on your marketing plan.

There are also several books that cover law firm financial management in the practicePRO lending library.

Categories: Practice Aids