Every lawyer knows the importance of rainmaking. It’s a ubiquitous discussion topic in law firm land. Virtually every legal industry conference features sessions on rainmaking best practices and consultants crisscross America training the future rainmakers of Big Law.
Rainmaking matters. It greatly impacts your compensation and capacity to create wealth. While rainmaking largely drives how much you make, RainCatchingTM will determine how much you keep.
What am I talking about? Simply put, RainCatchingTM is the process to help lawyers keep more of the rain they make.
In the coming months I will detail the six steps of the RainCatchingTM process. Today provides a high-level overview.
Let’s start with a lesson from nature. Until several months ago California was mired in a severe drought. For years it hardly rained. Then something amazing happened in late 2016 and early 2017. It started to rain and snow… and snow… and snow. In a matter of months so much precipitation fell that Governor Jerry Brown declared the drought over in April. During a conversation with one of our California-based clients I marveled at this turnaround. What he said really caught my attention. He said, unfortunately we don’t have the systems in place to fully capture the rain. Sadly, much of the rain will simply run off into the rivers, flow out to the ocean and will be gone forever. Not good.
The same is true for lawyers. If you don’t have the systems in place to catch the rain you make, you’ll turn around in your 50s and wonder where it all went.
How do you prevent this tragedy?
- Big Picture – Start with evaluating what a full life means to you. What do you want your wealth to accomplish for your family? Clarity about what you value will help you make sound decisions.
- Checklist – The steps to financial freedom vary depending on your career stage. The Attorney’s Financial Freedom ChecklistTM highlights steps you should take to secure your financial future. Issues unique to attorneys such as uneven cash flow, quarterly tax estimates, complex firm-sponsored retirement plans, early retirement packages, post retirement income options and capital account payouts all need to be considered.
- Integrate – A portfolio is not enough for financial peace of mind. You need a comprehensive plan that unifies your career objectives and family goals. A cohesive strategy that coordinates each aspect of your financial life including taxes, retirement planning, estate planning and investments is critical to success.
- Engage – Your financial plan should be a living document not a book that sits on a shelf. The planning process needs to be dynamic. A “live planning” approach will enable you to adjust your plan in real-time and solve for the highest probability of a successful future.
- Invest – Your portfolio likely consists of more than just a brokerage account and a 401(k). You may have a cash balance plan, a partners’ retirement plan, venture capital and private equity holdings. All of these pieces need to be considered when designing and implementing your investment game plan.
- Evolve – Your life, your practice and your goals evolve. Your plan must evolve accordingly. As life unfolds your plan should be monitored and revised to ensure it grows with and for you.
Lawyers are smart to focus on rainmaking. It goes a long way to determining your advancement and your comp. Let’s not forget, however the truth of the old adage “it’s not what you make; it’s what you keep that counts.” With a keen eye towards RainCatchingTM, you’ll end up with a lot more when it’s time for life after the law.
Justin Peacock, MBA, CFP® is an Owner and Wealth Manager at BDF. In addition, he leads BDF’s Attorney Practice Group. This group is dedicated to providing financial planning and investment management services specifically tailored to addressing the distinct needs of lawyers. As practice group leader, Justin is responsible for the overall vision and strategy of the practice group and for developing customized solutions for BDF’s attorney clients. Justin graduated magna cum laude from Illinois State University with a B.S. in Mass Communication and earned his MBA from Northwestern University’s J.L. Kellogg School of Business.