Starting a law firm requires a good sense for business and excellent legal knowledge. The most important factor is to be licensed to practice law by the appropriate governing body, after which a business, such as a sole proprietorship or limited liability company (LLC) can be formed. Another important early step is to start two bank accounts, one of which will be a trust account. It is possible to work from home when first starting a law firm, but using a service that will provide a corporate mailing address and meeting space may be perceived as more professional. Finding shared office space with another law firm that may provide client leads or other helpful resources is also an option.
The process of starting any new business can be expensive, time consuming, and difficult. There may be long hours and low pay involved during the initial startup phase, so financial stability before beginning the process is important. It can also be a good idea to obtain real world experience by working for an existing law firm first, though that is not absolutely necessary.
There are typically very strict regulations on how law firms operate, including the way that money is handled. One option to stay on top of these factors when starting a law firm is to obtain specialized accounting software. Another way to deal with the financial aspect of the business is to retain the services of a qualified accountant who has experience in dealing with law firms.
One particular area where there is typically strict oversight is the way that client funds are handled. A law firm typically needs to have at least two different bank accounts. One account is for the law firm's money and the other is a trust account so that those types of funds are never commingled with personal money. The laws and regulations that govern financial activities can vary from one jurisdiction to another, so it is important to be well versed on the subject when starting a law firm.
The physical location of a new law firm is another factor to consider. Working from home in the early days of starting a new law firm is fine, though it can be a good idea to have a professional space to meet with clients. Both a corporate mailing address and a professional meeting space can typically be rented for substantially less than an actual office would cost. The minimum equipment required to run a new law firm from home is typically a computer with Internet access, phone, fax machine, and printer.
Sharing space is another option that is typically less expensive than renting an entire office for a new law firm. This involves paying for an office at the physical location of another law firm or group of firms. In addition to the office, access to meeting rooms and other resources will typically be available as well. Another benefit to sharing space with other lawyers that they may provide referrals or offer advice based on experience.
