Do you dread billing? Does it feel like it takes up a lot of time or like you’re always scrambling to get invoices out? If so, you’re not alone – billing isn’t what most lawyers thought of when they signed up for law school.
Even if you have someone who helps with your billing, it can still seem like there are always errors, that invoices aren’t being sent out timely, that there are collections problems or that you’re not including all billable hours or recoverable costs. It doesn’t have to be that way though. With technology, you can turn your billing into a regularly scheduled, organized, easy to do task that gets clients to pay their bills on time.
Whether you’re using a stand-alone system for purely legal billing or using one that’s built into a practice management program, using a tool that’s built specifically for the legal industry is going to save you a lot of time. Client matters, how billables work (including recoverable costs and client expenses), and time tracking are all important pieces for law firms who want to make sure they’re invoicing accurately.
All of this information also needs to make its way to your accounting and practice management programs if you have them so your records can be up to date in every location. Don’t rely on integrations to get the job done. If you do wind up going the non legal-specific route, make sure to test any integrations with your accounting system if it’s a separate program or your practice management system.
Be professional with your invoicing
Your invoices are an extension of your firm and present an opportunity to highlight the work and value you provided to clients since the last invoicing period. Doing them by hand can result in errors, and also can lead to inconsistencies.
With a singular tool, you can ensure that all the information is on the invoice and that it’s been correctly pulled. While overbilling a client is certainly not going to encourage a positive experience, underbilling can be just as bad. If you don’t remember to put on the correct amounts or forget to include client expenses, it can be really hard to go back later and send an additional invoice if the client has the expectation that’s all they owe.
Legal billing, if done manually or by sending a singular invoice at a time, can take a large amount of time. Many legal-specific tools have features that allow you to create automations designed to save you from handling traditional administrative level tasks.
For example, you can use batch invoicing to create invoices for multiple matters and clients with a few buttons. If you’re doing this one by one with your current system, then you can easily be spending up to two to three hours more than you need to. And just like you can create them with a few clicks, you can do the same to send them out rather than sending them one by one.
Another piece you can easily automate is the collections process. Ideally, when invoices are being sent out on time and with clear descriptions, client payments should be consistent. But there are times when you need to remind them – life gets busy for all of us.
Rather than taking the time to review your accounts and see what items are open, you can set up automatic reminders for clients when invoices are past due.
Record billable time and expenses as they happen
Time-recording, especially if your firm operates on a billable hour rather than a retainer basis, is a must. If you want to get paid for all your work (and who doesn’t?), it’s best to record time as it happens. Otherwise, you’re left at the end of the day – or even worse, the end of the week or month – estimating how much time you spent on a case. You’re likely to underestimate rather than risk overbilling clients or simply forget the true time spent.
The same goes for expenses. You should create entries for them as they occur, or you’ll have to backtrack through your records later to figure out what was spent on each case.
With technology, you can put in entries as they happen. No writing them down on paper and hoping they make their way into the system later. No more trying to recall what happened last week. Instead, take advantage of the cloud-based services and apps that come along with many systems to put in a record right then and there. If your billing program is part of your practice management program, that’s another time-saver – your entry will be automatically tied to the appropriate matter.
Accept online payments
Current events have shown how important it is to make it easy for clients to pay remotely. With online payments, you get it all:
- Give clients an option to pay quickly, increasing cash flow
- Reduce the amount of work you have to do (no checks to deposit)
- Added value offering for clients
In addition to online payments like eCheck or ACH, you can also extend the option to include credit cards. Be careful to choose a merchant who is aware of the requirements surrounding trust accounts, such as where merchant fees should be pulled from (the firm’s operating account, not the trust account).
Make the most of technology
No matter what your billing process currently looks like, there’s often a way to improve it through technology. Getting the most out of it will depend on the provider you choose and also how much you work to make it an integral part of your firm. With the right setup, legal billing doesn’t have to be a headache and can instead become a streamlined, easy to process task.