It’s a situation no lawyer wants to be in—following up with a client whose account is overdue.
And while it’s hard to avoid challenging accounts altogether, there are a few steps you can take to bypass most potential problem accounts.
First, if you don’t already do so, collect retainers. Holding a retainer in trust for a client often sets you up to avoid the situation of an overdue account to begin with.
But a retainer only works if it hasn’t been depleted, so leverage tools to keep your clients’ retainers evergreen. A modern practice management system’s integrated billing and accounting should allow you to stay on top of balances—notifying you when retainers get low and even sending out automated reminders to clients for replenishment.
Accept credit cards
Trust accounting laws have historically made credit card payments difficult for law firms to accept. Because the money needs to be deposited into a separate account from where the convenience fee is withdrawn, many lawyers have steered clear of accepting credit cards.
But there’s no denying that online payment options with credit cards make the payment process easier and more convenient for clients—seriously upping the likelihood that they will pay promptly.
Fortunately, tech has been keeping up with the need. Legal-specific merchants like LawPay allow you to set up a credit card payment system where the money is deposited in a trust account and the convenience fee comes out of a separate account, such as your operating account.
Scheduled payments and fee relief
Collecting retainers and accepting credit cards should carry you most of the way toward getting more clients to pay on time. But you can also offer scheduled payments.
For instance, you can make a legal, written agreement with a client that on a set date each month, their credit card will be charged a certain amount. Your firm may also choose to provide fee relief in special situations.
If you do offer a scheduled charge option, you’ll want to thoroughly consider the client’s financial situation so that you know the client can make the payments.
Ultimately, however you approach the issue—from maintaining evergreen retainers to accepting credit cards or scheduling payments—good tech can go a long way toward helping you reduce your overdue accounts.