by Deb Tesser, VP of Strategic Planning at Zola Media
Does your firm sometimes struggle to get payments in the door? Have you considered evergreen retainers?
What is an evergreen retainer?
An evergreen retainer is a type of security retainer. Just like other types of retainers, your client pays you a sum up front and you are able to use this money to pay your fees and expenses. The difference is with an an evergreen retainer, your client needs to keep a predetermined minimum balance on the account.
The evergreen retainer will solve a problem that commonly plagues attorneys – collecting fees from the client or dealing with a client that refuses to pay or says they cannot afford to pay. Even attorneys who collect retainers upon initiating an engagement may face this problem if they fail to track their time spent and expenses associated with a case. Before they know it, the original retainer amount is spent, and the expenses continue to mount.
What are some other advantages of using evergreen retainers?
This type of retainer is also beneficial in cases when the costs are difficult to estimate and the client is unable to or refuses to pay a large retainer up front. With the evergreen retainer, your client can put a smaller sum of money down and then replenish the retainer on an ongoing basis. This means that you can still ensure you are paid and your client will not have to expend a lot of money up front.
As with all fee-related arrangements, be clear with your clients about what an evergreen retainer is and the consequences of failing to replenish the funds. No surprises in client billing is a great way to maintain a positive lawyer-client relationship and avoid a bar complaint. Put all the terms of the retainer in writing, clearly laying out the client’s obligations. Retain a copy of the signed retainer for your files and have your client signoff to confirm that he or she reviewed and received a copy as well.
It is very important that you accurately account for all expenses and fees associated with a case and this is no different when you are using an evergreen retainer. Proper accounting will allow you to track the balance of the retainer and know when the client needs to post more funds.
How can Zola Suite Help Firms Implement Evergreen Retainers?
Zola Suite offers users a new Evergreen Retainer option that allows them to set up Evergreen Retainers on a per matter basis and designate whether the funds should be applied to business or trust accounts. Zola users will receive notification once a Matter’s balance falls below the set minimum amount so they can let their client know it is time to replenish the funds.
Learn more about RMail integration with Zola Suite.
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