Fall 2014 issue of Horizons

LAW FIRMS

Proactive Succession Planning for Your Law Firm by Matt Finke, CPA & Lynnae Robinson, CPA

T he picture of retirement looks different for each of us. The one thing that we all have in common when it comes to retirement is that we can’t ignore it. It’s no surprise that the number of people approaching retirement age is ever increasing as, in the next few years, the youngest baby boomers will be in their 50s while the oldest will be in their 70s. This means a record number of people will be leaving the work force or significantly reducing their hours. These pending transitions will have a major impact in nearly all industries, and the legal industry is no exception. Baby boomers have been instrumental in building, managing and leading their firms.

changes is through extensive planning, a recent Altman Weil survey revealed that approximately only 27% of law firms have a formal succession plan in place. There are a number of reasons firms and individual partners avoid planning for the future. This same survey asked respondents to identify firms’ hindrances to succession planning.

The top reasons included:

∙ Partners not willing to retire

∙ Partners not willing to forfeit compensation by transitioning client work

∙ Lack of adequate successor partners

Despite widespread agreement that the best way to prepare for such leadership

∙ Avoiding awkward conversations

page 38 | horizons Fall 2014