Determining an Hourly Rate?
Posted: Fri Jul 06, 2012 11:43 am
I am targeting a midsize city with a low-average cost of living. I just graduated (regional school/TTT, top 10%, with honors, law review), and I think I am about to receive an associate offer from a well-respected solo in my desired area of practice (he has been calling references, requesting writing sample after interview, etc.). I have no aspirations of becoming a cabillionaire, but I would like to be able to pay my student loans, mortgage, day care/private school for small child, etc. I estimate that at very bottom, I would need to bring home about $2500/mo after taxes, though of course I'd like to make more.
I would be a 1099 employee and receive 50% of what I bill that actually comes in. I have done lots of info interviews with lawyers similar to this one, and this fee arrangement is pretty standard for a new associate in this city in this practice area. The solo/partner would, in turn, bring in the business, pay for my CLEs and bar fees, provide an office and paralegal, etc. No benefits, but my spouse is gainfully employed and provides us with benefits, so it's not a major concern. The person who was there before me was making a respectable living, but was a few years out from law school, so not directly comparable. The solo is obviously profitable and about 20-25 years ahead of me in practice, so he has lots of experience to draw on.
What I'm struggling to figure out is what I could realistically bill out at hourly, and how many hours per week I could bill, and what percent of my billed hours would actually be collectible (in other words, what would clients be willing to pay and would it be enough to support my standard of living?). The area of practice is primarily divorce/custody/probate stuff, and there is a substantial retainer (that is technically supposed to be refilled when depleted), but that only goes so far, of course. The solo/partner charges about $250-300 hour, which my research indicates is pretty standard for a divorce/probate attorney of his level of experience in this city, just to give you a baseline. My research is just drawing a blank on what a brand-new associate should be charging.
The solo indicates that he is turning away business, which is why he has decided to take on an associate, so I know there will be enough work (and there was enough work for my predecessor). I just have no idea what it's realistic to charge, and I have no idea how to figure that out. I know this is TLS, where everybody is all "go Biglaw or go home," but I thought I'd see if anybody had any advice on how to figure out what a good rate is. And please don't go quoting ABA MRPC crap to me. I know what the factors are. I'm just clueless as to what they're worth in terms of $$.
Edit: I'm not trying to ask anyone to set my rate. I'm sure if there's an offer, the solo will help me do that anyway. I'm just wondering about how much I can expect to bring in if this pans out. And if I'm not offered this position, I'm expecting that I'll be offered something very comparable...so just trying to get a sense for whether I can make a living this way.
I would be a 1099 employee and receive 50% of what I bill that actually comes in. I have done lots of info interviews with lawyers similar to this one, and this fee arrangement is pretty standard for a new associate in this city in this practice area. The solo/partner would, in turn, bring in the business, pay for my CLEs and bar fees, provide an office and paralegal, etc. No benefits, but my spouse is gainfully employed and provides us with benefits, so it's not a major concern. The person who was there before me was making a respectable living, but was a few years out from law school, so not directly comparable. The solo is obviously profitable and about 20-25 years ahead of me in practice, so he has lots of experience to draw on.
What I'm struggling to figure out is what I could realistically bill out at hourly, and how many hours per week I could bill, and what percent of my billed hours would actually be collectible (in other words, what would clients be willing to pay and would it be enough to support my standard of living?). The area of practice is primarily divorce/custody/probate stuff, and there is a substantial retainer (that is technically supposed to be refilled when depleted), but that only goes so far, of course. The solo/partner charges about $250-300 hour, which my research indicates is pretty standard for a divorce/probate attorney of his level of experience in this city, just to give you a baseline. My research is just drawing a blank on what a brand-new associate should be charging.
The solo indicates that he is turning away business, which is why he has decided to take on an associate, so I know there will be enough work (and there was enough work for my predecessor). I just have no idea what it's realistic to charge, and I have no idea how to figure that out. I know this is TLS, where everybody is all "go Biglaw or go home," but I thought I'd see if anybody had any advice on how to figure out what a good rate is. And please don't go quoting ABA MRPC crap to me. I know what the factors are. I'm just clueless as to what they're worth in terms of $$.
Edit: I'm not trying to ask anyone to set my rate. I'm sure if there's an offer, the solo will help me do that anyway. I'm just wondering about how much I can expect to bring in if this pans out. And if I'm not offered this position, I'm expecting that I'll be offered something very comparable...so just trying to get a sense for whether I can make a living this way.