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

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There are few areas of the paralegal field more exciting and challenging than working as a freelance paralegal. As a freelance paralegal, you'll be able to be your own boss and chart your own course. (There is even one freelance paralegal working in San Francisco who reports 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?

Basically there are two types of freelance paralegals, those who work on there own or in a loose association with a few other freelance paralegals, and those who run full-fledged 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 his or her 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 for the drafting of a will or for digesting of 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 services companies may develop from freelancing. A successful freelancer may hire his or her own staff and set up a business organization, partnership or corporation. Paralegal services companies have their own office space and undertake more sophisticated marketing strategies than do individual freelancers. They usually provide services of temporary paralegals, legal research services, managing clerk ser vices (the service of papers and filings at court) or specialized services in trusts and estates and the like. Essentially, these services are small businesses run by entrepreneurs who, if successful, must be good managers as well as knowledgeable paralegals.

Both types of freelance 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 field? The first thing needed is some expertise. How much expertise is enough? That's really impossible to say, but you'll need enough experience to know what you're doing unaided, and enough to convince prospective clients to trust you. Four to five years experience is suggested before going freelance. A minimum of two years is required to begin handling 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 your experience can be equally important. If you've worked for highly respected, expert lawyers in a specialty area, this can lend added professionalism. Having a letter of reference from your previous employers at testing to your competence can be a big help too.

Finally, experience is needed to know your way around the legal community, to learn how to work with lawyers, about the way different firms are run and to become acquainted with many people in the field. The more experience, the better. Equally important are your personality and drive. You'll need the desire to succeed buttressed by a sense of confidence that inspires trust in you. You'll need commitment to long hours and a sense of responsibility and care so that your clients always receive your best efforts. Calmness and 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'll need business savvy, organizational ability, punctuality and management to pull it all together.

You don't have to have a lot of capital to get started as a freelance paralegal. All you really need are stationery, business cards, a simple brochure, a mailing address and telephone answering machine or service. Of course you'll have to be able to support yourself while you're getting started, building up a reputation and a clientele-which may take from a few months to a year. Many successful freelancers work for a law firm part time while establishing their own business.

Finally, you'll need some skill in selling.

How Much Can You Earn as a Freelance Paralegal?

It's possible to earn such an amount if you run a paralegal services business and have many people working for you. But suppose you're an independent con tractor. 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'll earn $30,000. This means that you've got 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'll 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 work week. If you make $20,000 a year now, you'll have to bill out to clients a minimum of 35 hours per week at about $ 11 per hour. However, this doesn't include the benefits and extras you may be get ting now-which may amount to an additional 25% of your salary. You'll have to budget some time for selling and conducting a marketing campaign-as much as five to ten hours per week, as well as whenever you don't have any projects. This marketing time will cut into your billing time.

The way to earn the most money in the freelance field 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 in order to cover your selling cost, supervising time and a modest profit.

Of course, money isn't the only reward. Some freelancers earn significantly more as freelancers, others less than they did as full-time employees; but almost every freelance has the added benefit and personal satisfaction of being self-reliant.

If you have worked in more than one field, or as a generalist, then you’ll have an unusual opportunity to either choose a specialty or to 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'll have some choice in the field in which you'll work. There's 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. Relatively speaking, there's less work in the narrower specialties than in litigation, for example. But then, there's also less com petition, 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, there are many paralegals with thriving freelance careers in these areas; so don't 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're a talented paralegal, that you're resourceful, reliable and experienced. To be a success as a freelancer, you'll have to find ways to let your future clients know this too. And that means you'll have to sell them on yourself and your skills. In fact, your talents as a self-marketer are as important to your success as your expertise as a paralegal.

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

The art of selling is showing how your product or service meets the needs of your clients. This means you've got to know what your clients need, want and value. These are called "benefits." A benefit is not the specific tasks that you'll per form for your clients; it also includes how those tasks 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, then he or she's having the services you want to provide handled some other way. Can you show the client why he or she should call you, instead, the next time a need arises?

To get started on your marketing campaign, make a list of all the skills you have and of the specific tasks you know how to perform. Next, look at your prospective clients. Check off on your skills and tasks list 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 the expertise in house? 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're ready to put together some marketing literature.

There's nothing like a brochure to transform 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 shouldn't tell your whole story, for you'll want something left to say when you meet your client for the first time. A good brochure needn't 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, ser vices 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're ready to begin contacting clients. The most effective way to start is with a phone call to your potential clients. Telephone those attorneys who might be interested in your services, and identify yourself as a professional paralegal consultant. Don't be longwinded, but focus in on how you can help them. An introduction like this works well: "Hello, my name is Judith Brown. I'm an independent consultant specializing in probate paralegal work, and I'd like to discuss how I can improve your work productivity. When would it be convenient for us to meet?" If you're unable to pin down a set time for an appointment, drop by anyway to leave your brochure. When you're 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 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 try to get the client to call you for a free brochure, for example. Or you might tell the prospective client that you'll be calling shortly to set up an appointment.

The more calls you make, letters you write and leads you follow up, the more successful you'll be. Marketing is a numbers game. For every 100 "no interest, no need" responses you get from a client, you'll get some positive responses- maybe two or three or maybe 25! It all depends upon how well you've targeted your clients and presented your services. Remember too, 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 with whom we've spoken has stressed the importance of networking. For freelance paralegals, there are two types of networks: the network of your clients and former employers, and the network of your paralegal peers. The importance of your client network should be evident. The lawyers for whom you've worked are the ones who'll attest to your reputation and to 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's a good bet that he or she will call a colleague to check your credentials. So pay attention to your reputation in the legal community. Do good work, and remind the lawyers of that. Whenever you complete a special project, ask the attorney for a letter of reference. You'll 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're the ones who'll keep you up on changes in the field and legal market, who'll tell you which firms are loaded with work and who'll pass on their extra work load to you. Join your local paralegal association, attend the meetings, and become involved.

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

Advertising is a great way for the novice freelancer to reach a large audience. But it's 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 ser vices." 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. Don't overlook inexpensive advertising. Put your notices and brochures on the bulletin board of your local bar association.

Whatever means of marketing you choose, don't forget to follow-up with it. A regular follow-up campaign is a crucial part of your business. Keep a file of everyone you've 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. If there are any articles written about you, or if you've accomplished something outstanding since your last mailing, include this new information. 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'll agree, then arrange to work for him/her part-time on an hourly basis or by the project. If your employer will give you the work you need to begin, you can then spend some time marketing, and begin to develop 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 paralegals are getting for freelance 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's hard to tell, until you're well underway, how long a project will take. For a standard assignment, like drafting a will or filing a form, a flat rate is acceptable. With experience, you'll know how long it should take and you'll charge accordingly.

Always bill your clients promptly. If it's 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'll probably confront a few tough cases. Be persistent and keep after them, but don't lose your sense of humor or your cool. It's not worth alienating a client and his or her 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 that specialize in the same area, or if you work in a small community. You might find yourself hired by a firm that's on the opposing side of a case from a former client. In matters like this, you'll 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've taken the personnel service route, and are hiring out other paralegals. Make certain that none of them are involved in 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. In some states, it is a criminal offense to practice law without a license. While it is doubtful you'll ever be thrown in jail, 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 he or she is authorizing 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 for whom you work reviews and signs your work product.

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