The best money advice is about way more than earning good money. As we become better and better at what we do, the money does flow in more and more. It is probably a fact. This is particularly the case if we focus on being of significant service to our clients. Yet, despite its flowing in, it is important to take care of money every step of the way.
Best Money Advice for Lawyers
I am not an expert in financial matters. I do not hold myself out to be. At the same time, however, I have learned some hard lessons. I am hoping some of these hard lessons can help others avoid some of the disastrous financial consequences I have experienced in the name of being successful.
I have developed a very simple formula for financial success. It is working.
The steps are easy and the rest can flow from that:
As divorce lawyers, we may not even notice as we slowly accumulate more possessions, payments and complications in our lives. So many of us spend years accumulating things only to then downsize later in life. What if we avoid the whole accumulation then de-accumulation cycle and focused on a life of experience and meaning?
What I have learned over the past two years is that small changes can add up and make a huge difference faster than we think. That has sure been my experience.
Take a read of the Mr. Money Mustache website which is totally awesome and a great source of the best money advice for everyone, not just lawyers of course.
Best Financial Advice Rule Number One - Start Saving Now:
Even if you don't think you have anything to save, start with a small amount now. Pay yourself first.
Best Money Advice Rule Number Two - Don't buy stuff on credit:
We already know that our whole economy depends on the use of consumer credit.
We look around and see advertisements for us to use financing to lease vehicles, and to buy phones and electronics.
Lawyers are not the only professionals who, from the time we are university students, have overt and covert pressure to make these expenditures.
We end up creating a life as cluttered with unwanted lease payments, bill payments and huge mortgages as our lives are cluttered with things. We tie up our futures by buying stuff on credit.
Tony Robbins (a life success coach and very wealthy guy) said it best in his book, Money Master the Game*, that every time we use money, we are making a financial decision. He said that in our consumer economy, the problem is that most of the times those financial decisions we make are poor ones as we spend our money on loans, mortgages, leases, fast food, and other consumer goods we do not need.
Our entire western world economy depends on us borrowing money and continuously buying more things. From the time we are university students, there is pressure on us to sign up for credit cards, purchase cars on payment plans, and purchase electronics with deferred payments.
Val’s Background, From Near Financial Disaster to Recovery(ing):
When I started as an articling student after law school, my salary was $1850 per month. Now, I appreciate this was, like 1995, so in today’s dollars it might be like, $2,500 per month. I could not believe my luck in terms of how much money that was. It seemed like a mass fortune compared to what I had been living on as a student.
However, the more experienced lawyers I worked with assured me that as my income increased, so would my expenses. They said I would quickly learn to spend all of the money I was earning. I could not even believe that was possible.
Unfortunately, they were right.
While it is true that becoming a lawyer can lead us to earn a good income, it is most often a trading time for dollars type of work (if we are not working generating revenue, we are not earning an income). I unwittingly jumped onto a never-ending hamster-wheel of my time spent earning money, increasing my expenses, and then earning more income to cover those expenses and so on.
Add to this the consumer credit I used, and it added up to a fairly significant nightmare in terms of finances. I was working hard, playing hard, and spending hard.
As if this was not difficult enough, I purchased a strata-titled unit for my small law-firm in a new development. It was financed to the maximum amount possible and the construction costs (no surprise here) went well-beyond budget. In order to pay for all of this, I increased the mortgage on our home to a significant extent and used all of my available savings and credit (not to mention that of my husband's).
Not surprisingly, my financial life had become excruciatingly stressful and complicated. It almost killed my marriage, my closest friendships and my feelings of self-worth.
I was living in continued crushing financial stress. For a period of more than 4 years I woke up virtually each and every morning with my stomach doing somersaults from the anxiety. I would awake in the middle of the night barely able to breathe because of my fear and worry about finances.
I was, and continue to be, totally leveraged.
I had to take drastic measures to put my financial house in order.
Now, each week I release the financial pressure a little more.
I have taken steps to turn my very huge financial ship around.
Now I am not suggesting that all divorce lawyers make it as financially difficult for themselves as I did. At the same time, as with many other professionals, I notice that many of my colleagues are working hard, hard, hard, and they are doing little, it seems, to get ahead. What would they say if they were asked to give their best money advice?
While many of my colleagues may not have created the financial disaster for themselves that I did for me and my family, many of them are only able to take minimal time off at any given time due to their constant money concerns. They have big mortgages, leased vehicles, the latest in iPhones, but they have little time to breathe. They have little time to design their lives effectively.
Now I am not saying I personally have all the answers or the best money advice. I do, however, have an extensive history of screwing up this way and making my life and that of my family's very difficult as a result. So, I have also done a lot to put it right and am still struggling to do so. I am hoping that my sharing of these experiences, and what others say about the best money advice can help.
Best Money Advice Rule Number Three - Be in total service to your clients and colleagues:
The best way to financial success is by being really darn helpful all the time.
One of the most amazing things I see over and over again, is that when I truly focus on my client's needs and doing a great job, the money (and client referrals) simply continually flow in.
Being in service to others makes financial life better.
By Val Hemminger, divorce lawyer
Contrary to what we are lead to believe, for the most part, money does not buy happiness. Money problems, however, can buy us a whole lot of unhappiness.
Val has created this website to share with her colleagues. She is not suggesting, by any means, that she is the best divorce lawyer out there. She is, however, suggesting that she is the best divorce lawyer that she herself can be. Feel free to share anything you find useful.