30/09/2024
write-up #11
Lawyering and financial management
The number of lawyers who have been disciplined by the Supreme Court due to finance issues speaks volumes of their lack of financial acumen. The common issue is spending beyond their capacity.
Private law practice is not the popular path for lawyers. Many take the government or corporate employment where the salary comes every month, regardless of the work load. New bar passers initially go to private law practice only to face financial issues. A new private practitioner has to deal with office rents, salaries of staff, light and water, and other miscellaneous expense.
The finance issues force lawyer to quit private practice to find a more stable source of monthly income. Meeting the finance needs of law office, and the new family is a daunting task. If I am not wrong, there are only five in my batch who remain in the private practice.
Live within your means. Or better still, live a little bit below your capacity. That way you force to save for the dry months of private law practice. Unlike employment income, private practitioners do not earn income on a regular basis. There are times when you earn one year worth of salary income in just one case. When you do, save a lot because the following months may be very lean.
As a young lawyer, my first car was a Kia Pride. I had a car loan with a bank. The officer of the bank was a fraternal brother. He was offering me to take a car loan for a full-sized sedan, while taunting me for taking a small car. A little irritated, I quipped: " If I have money, I will buy a land cruiser. " Years after, my fraternal brod, may his soul rest in peace, was terminated from the bank, and was facing qualified theft cases for dipping into the bank's assets.
Whenever I drove my Kia Pride, non-lawyer friends who were riding better cars would joke at me, pointing that a lawyer should drive a better car. I did not mind them and I was in fact was driving it with pride. I earned it, and never defaulted in any monthly amortization. Many cars after, and so do the car loans, not one month did I default in the payment to the extent that the banks urge me to loan for a luxurious car.
Good finance management makes good private law practice. Sometimes, lawyers accept non-meritorious cases out of financial necessity. The key to any young private law practitioner is to attain financial stability so that he is not compelled to accept clients if he is doubtful of the merit of the case. Sound decision is accepting cases is best if it is based on the factual and legal backdrop of the case and not from any extraneous considerations.
There are court cases which have been filed and one wonders why they were filed at all. Your guess is as good as mine.
A private law practitioner does not expect to receive pensions or retirement benefits after their active years, save for the SSS pensions and the private pension plans. Have an SSS and get pension plans. Better still get health insurance plans. Law practice requires personal service. You earn while you can still walk to the court room or sign a document. When your health breaks down, your hardener is better at earning income than you.
In my mid-thirties, I was in a court room with my former dean, a former legislator, and a former mayor of the city. They were aging and limping, and obviously had missing gaps about their knowledge of the law. Right then, I realized that I should strive to have a passive income to tide me at times when the body is weak, and will be inevitably be weaker. That realization compelled me to plant trees and will not mind if I would be harvesting them in the sunset of my life.
Create sources of income other than your private law practice. When your income does not depend only on your lawyering, you are more discerning in what cases to accept. You will find private law practice very fulfilling and therefore, you perform better, and consequentially, without you realizing it, you have grown professionally.
Unless one has sound financial management, the fortitude to stay within the ethics of lawyers may waver.