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How to Earn Up To $200,000 a Year Working as a Freelance Paralegal

published January 24, 2013

By Author - LawCrossing
Published By
( 608 votes, average: 4 out of 5)
What do you think about this article? Rate it using the stars above and let us know what you think in the comments below.
You do not have to be a lawyer to work in the legal profession. Two of the most common jobs in this industry are paralegals or legal assistants.  Both roles of a paralegal and legal assistant provide support for lawyers with preparing cases and general administrative work.
 

A few areas in the paralegal field are more exciting and challenging when working as a freelance paralegal. As a freelance paralegal, you will be able to be your boss and chart your course. (There is even one freelance paralegal working in San Francisco who reported that her gross income tops $100,000 a year.) An increasing number of paralegals are striking out on their own as freelancers, independent contractors, and entrepreneurs. What is a freelance paralegal? Who are the freelancers? What are their qualifications? How can you become one?
 

Types of Freelance Paralegals

 

There are two types of freelance paralegals, those who work independently or in a loose association with a few other freelance paralegals and those who provide paralegal services, with business addresses, advertising, and a staff of employees. The first type of freelance paralegal, truly freelancers, are sometimes called independent contractors, a name for one individual who bills for their services but is not on anyone's payroll. Independent contractors often bill attorneys on an hourly basis, but sometimes charges are rendered by the project, such as drafting a will or digesting depositions. Often such paralegals work out of their homes, using an answering machine or service number, a centrally located post office box address, and a descriptive brochure as means of presenting a professional image to their clients. These freelance paralegals work in many areas of legal practice.

Paralegal service companies may develop from freelancing. A successful freelancer may hire their staff and set up a business organization, partnership, or corporation. Paralegal service companies have their own office space and undertake more sophisticated marketing strategies than individual freelancers. They usually provide contract paralegals (i.e, outsource paralegal work), legal research services, managing clerk services (the service of papers and filings at court), or focused legal specialty services in trusts and estates and the like. Essentially, these services are small businesses run by entrepreneurs who, if successful, must be good managers and knowledgeable paralegals.

Both types of freelance experienced paralegals bill their clients between $8 an hour for low-level tasks to as much as $40 an hour for highly specialized and sophisticated work.
 

What Qualifications Are Needed To Enter The Paralegal Field?

 

Most paralegals have an associate degree or a bachelor's degree in paralegal studies or related paralegal certification. Depending on your paralegal career goals, you may also consider a master's degree in legal studies. Certifications at the national or state level are also possibilities.

For your paralegal career to take off, the first thing needed is some expertise. How much expertise is enough? That is impossible to say, but you will need enough experience to know what you are doing unaided and enough to convince prospective clients to trust you. Four to five years of experience is suggested before going freelance. A minimum of two years is required to begin handling the basic work. In addition to years of experience, you should have a basic knowledge of the tasks most paralegals do in your area. Where you have gained experience can be equally important. If you have worked for highly respected, expert lawyers in a specialty area, this can lend you added professionalism. Having a letter of reference from your previous employers attesting to your competence can be a big help too.

Finally, experience is needed to know your way around the legal community, learn how to work with lawyers, how different firms are run, and become acquainted with many people in the field—the more experienced, the better. Equally important is your personality and drive. You will need the desire to succeed buttressed by a sense of confidence that inspires trust in you. You will need commitment to long hours and a sense of responsibility and care so that your clients always receive your best efforts. Calmness and the ability to deal with pressure and difficult-to-get-along-with personalities will also help you over the rough spots, which are part of such work. Finally, you will need business savvy, organizational ability, punctuality, and management to pull it all together.

You do not have to have a lot of capital to start as a freelance paralegal. All you need are stationary, business cards, a simple brochure, a mailing address, and a telephone answering machine or service. Of course, you will have to support yourself while getting started, building up a reputation and a clientele-which may take a few months to a year. Many successful freelancers work for a law firm part-time while establishing their own business.

Finally, you will need some skills in selling.
 

How Much Can You Earn as a Freelance Paralegal?

 

It is possible to earn such an amount if you run a paralegal services business and have many people working for you. But suppose you are an independent contractor. Let's say your hourly billing is $15/hour, a modest amount, but one which will not scare off clients. If you work 40 hours per week, 50 weeks a year, you will earn $30,000. This means that you have got to work all the time, which is difficult to do. You might work 100 hours one week and go three weeks with hardly any work. Of course, you may be able to bill as much as $25-40 per hour for some tasks. If you can, you will be able to earn much more.

Another way to analyze budget, billing rates, and profitability is to divide your current weekly earnings by 35, the standard number of hours in a workweek. If you make $20,000 a year now, you will have to bill out to clients a minimum of 35 hours per week at about $11 per hour. However, this does not include the benefits and extras you may be getting now-which may amount to an additional 25% of your salary. You will have to spend some time selling and conducting a marketing campaign- as much as five to ten hours per week and whenever you do not have any projects. This marketing time will cut into your billing time.

The way to earn the most money in freelance work is to win projects or assignments through your marketing efforts and then delegate these to associates whose work you will supervise and for which you are responsible. Of course, their share of the billings has to be less than the gross amount to cover your selling cost, supervising time, and a modest profit.

Of course, money is not the only reward. Some freelancers earn significantly more, while others make less than they did as full-time employees. Still, almost every freelance work has the added benefit and personal satisfaction of being self-reliant.

If you have worked in more than one field or as a generalist, you will have an unusual opportunity to choose a specialty or increase the work you handle by working in more than one field. You may be thinking about preparing for "going freelance" a year in advance and are willing to switch fields of work to gain more expertise. If so, you will have some choice in the field you will work in. There is no one answer as to which field is best for you. Highly technical fields such as the sophisticated areas of trusts and estates or real estate work will allow you to bill at very high rates. For example, there is less work in narrower specialties than in litigation. But then, there is also less competition, and depending upon where you live and work, you may have more work than you can handle. Specialty areas are affected by changes in the economy. Complex litigation and real estate are generally not as big as they were just a year or two ago. However, many paralegals have thriving freelance careers in these areas, so do not discount the opportunities. If you handle contingency-based litigation, make sure you are paid regularly-by the week or month- and not only if the attorneys win their cases.
 

Developing a Marketing Campaign

 

You know you are a talented paralegal, that you are resourceful, reliable, and experienced. To be a successful freelancer, you will have to find ways to let your future clients know this. And that means you will have to sell them on yourself and your skills. As much as your expertise as a paralegal, your skills as a self-marketer are also crucial to your success.

Marketing is not a magical art whose secrets are known only to a select few. It is something you can do well if you are willing to keep at it and if you are willing to be expressive about what you have to offer. The basic key to marketing is to market consistently and follow up on every lead or opportunity. Combined with doing your homework on what you have to offer and what your clients need, a consistent marketing effort should ensure success.

The art of selling shows how your product or service meets your clients' needs. This means you have got to know what your clients need, want, and value. These are called "benefits." A benefit is not the specific tasks you will perform for your clients; it also includes how they will help the client. Some typical benefits are increased productivity, savings in time, better work quality, convenience, and economy. You should recognize that if a prospective client is not using you now, they have the services you want to provide handled somehow. Can you show the client why they should call you the next time a need arises?

To get started on your marketing campaign, make a list of all the skills you have and the specific tasks you know how to perform. Next, look at your prospective clients. Check off your skills and tasks list of all the skills the client may need or value. Imagine all the different situations in which a potential client might need you. Be as specific as possible-are they big spillover projects? What about highly skilled tasks where the client is not likely to have in-house expertise? Or are they rush, short-deadline projects? Write down how each service, quality, and skill you have, personally and professionally, will benefit the client in these situations. Now you are ready to put together some marketing literature.
 

There is nothing like a brochure transforming you from a paralegal to a professional freelancer. Your brochure tells your story: who you are, what you do, how you will benefit from your clients, and who your clients are. It should not reveal your whole story, for you will want something left to say when you meet your client for the first time. A good brochure need not be complicated or fancy, but it must be well-written and nicely designed. Keep it brief. Include your name, address, phone number, and some information about your specialties, services, and experience. Brochures can get expensive, so keep it simple. A brochure that consists of a single sheet of good stock, folded in three and mailed in a regular business envelope works well. Or, simply have your brochure typed and offset on two or three pages of bond paper (or red-ruled legal paper) and stapled to a "blueback" folder cover.

Armed with a brochure, letterhead, and business cards, you are ready to begin contacting clients. The most effective way to start is to phone your potential clients. Telephone those attorneys who might be interested in your services, and identify yourself as a professional paralegal consultant. Do not be longwinded, but focus on how you can help them. An introduction like this works well: "Hello, my name is Judith Brown. I am an independent consultant specializing in probate paralegal work, and I would like to discuss how I can improve your work productivity. When would it be convenient for us to meet?" If you cannot pin down a set time for an appointment, drop by anyway to leave your brochure. When you are in the office, ask to see the partner or associate you spoke with. You might get a meeting on the spot.

You can also use a direct mail campaign. This can be done in two ways. You can mail out your brochure to clients, following up with a phone call to arrange a sales appointment. Or you can send each client a letter (using a word processor would be helpful here), telling the client what you have to offer. You can get the client to call you for a free brochure, for example. Or you might tell the prospective client that you will be calling shortly to set up an appointment.

The more calls you make, the letters you write, and the leads you follow up, the more successful you will be. Marketing is a numbers game. For every 100 "not interest, no need" responses you get from a client, you will get some positive responses- maybe two or three or maybe 25! It depends on how well you have targeted your clients and presented your services. Remember that every "no" today could be a "yes!" tomorrow as your clients' needs and perceptions change. So call all your prospective clients back every few weeks to keep in touch.
 

Every successful freelancer we have spoken with has stressed the importance of networking. There are two types of networks for freelance paralegals: the network of your clients and former legal professionals and the network of your paralegal peers. The importance of your client network should be evident. The lawyers for whom you have worked are the ones who will attest to your reputation and the quality of your work. As you probably know, the law is a profession that hinges upon reputation. And before anyone hires you for a project, it is a good bet that they will call a colleague to check your credentials. So pay attention to your reputation in the legal community. Do good work, and remind lawyers of that. Whenever you complete a special project, ask the attorney for a letter of reference. You will have something to show prospective clients, and they will have something on file to refresh their memory when a colleague calls about you. Your attorney contacts are important, but so are your contacts with other paralegals. They are the ones who will keep you up to date on the changes in the field and legal market. They will tell you which firms are loaded with work and who will pass on their extra workload to you. Join your local paralegal associations, attend the meetings, and become involved in the diverse work environments.

You might first think that your clientele would be small law offices, corporate legal departments, or independent practitioners because larger firms will have in-house paralegals to handle all the work. It is not necessarily so. Big firms have an in-house staff, but they also can have an enormous workload. Freelancers are ideal for taking care of the "spillover" work and handling specialized assignments. And do not overlook corporations. They are a good possibility for the specialty paralegal.
 

Advertising is a great way for novice freelancers to reach a large audience. But it is an expensive way to market your services. Unless you have a lot of capital to start with, forget about ads in the yellow pages or the daily newspaper. Stick to classified ads in the legal newspapers under "legal services." Advertising rates are less expensive than in most big-city dailies, and your ad will be seen by the people you want to reach-the attorneys in your city. Do not overlook inexpensive advertising. Put your notices and brochures on the bulletin board of your local bar association.

Whatever means of marketing you choose, do not forget to follow up with it. A regular follow-up campaign is a crucial part of your business. Keep a file of everyone you have contacted, along with the dates of your calls and letters and the responses. Set a regular schedule for calling or mailing back: every month, for example. Include this new information if there are any articles written about you or accomplished something outstanding since your last mailing. Telephone back after every mailing. In short, do everything you can to keep yourself visible in the legal community and to keep your name first in mind for the attorney who needs paralegal services.
 

Getting Started

 

There are two ways to get started, plunge right in or ease in slowly. The best way to ease in is to win the approval and encouragement of your current employer. If he agrees, then arrange to work for them part-time on an hourly basis or by the project. If your employer gives you the work you need to begin, you can then spend some time marketing and developing a clientele. Also, ask your employer to recommend you to other attorneys.
 

Billing Your Clients

 

Billing clients can become a touchy issue for freelance paralegals. Professionalism is the key to avoiding problems with billing and collecting. Before you begin a project, have a detailed, written, and signed agreement that spells out the terms of your work. Check around in your community to see what other freelance paralegals bill for their work. Unless you have exceptional experience or expertise, charge accordingly. You can bill on either an hourly basis, or you can charge a flat fee per project. For research work, an hourly fee is advised; it is hard to tell, until you are well underway, how long a project will take. A flat rate is acceptable for a standard assignment, like drafting a will or filing a form. With experience, you will know how long it should take, and you can charge accordingly.

Always bill your clients promptly. If it is a short project, have your bill mailed within two weeks of completion. For a lengthy, ongoing assignment, bill on a regular basis: every one or two weeks, for example.

Although most of your clients will be honest and pay their bills on time, you will probably confront a few tough cases. Be persistent and keep after them, but do not lose your sense of humor or your cool. It is not worth alienating a client and their colleagues because payment is a few days late. You should probably avoid working for lawyers who only pay on consignment: i.e., you only earn a fee when they win a case. If they lose, you might lose too.

Conflict of interest can become an issue if you work for many law firms specializing in the same area or a small community. You might find yourself hired by a firm on the opposing side of a case from a former client. In matters like this, you will have to exercise judgment. Talk to the lawyer who wants to use your services and ask if it would constitute a conflict of interest. Be especially careful if you have taken the personnel service route and outsourced paralegal work. Please make certain that none of them are involved in the conflict of interest projects.
 

Unauthorized Practice of Law

 

Although the role of a paralegal is challenging and diverse, one caveat must be borne in mind: a paralegal is not a lawyer. It is a criminal offense to practice law without a license in some states. While it is doubtful you will ever be thrown in jail, and there are a few things you should remember:
 
  1. You may not offer legal advice to a non-lawyer client,
  2. You may not represent a client in court,
  3. You may not advertise yourself as a lawyer.

Few paralegals deliberately set out to break the law. But to be on the safe side, take a few precautions:
 
  • Always work for a lawyer, never directly for the general public.
  • Avoid meeting independently with a lawyer's client.
  • Have a letter of agreement from the attorney stating that they authorize you to work for him.
  • Make certain that any lawyer you work for has been admitted to practice in your state.
  • Be sure that the attorney you work with reviews and signs your work product.
 

Conclusion


Prior to starting any career, you should weigh the pros and cons. As a freelance paralegal, you can begin working with a little experience, passion, and hard work!

published January 24, 2013

By Author - LawCrossing
( 608 votes, average: 4 out of 5)
What do you think about this article? Rate it using the stars above and let us know what you think in the comments below.