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The Law Entrepreneur
462. Stop Tipping Uncle Sam: Tax Strategies Every Attorney Must Know with Frank Rekas
00:38:51
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- [00:03]
A
Sam Alai. Here at the Law Entrepreneur, with our host, Bridget Norris, we focus on law firm strategies for law firm growth. Practical plays to help scale firms for every shape, size, and practice. It's time to talk about scaling. Let's have some fun.
- [00:22]
B
Welcome back to the Law Entrepreneur Podcast. I'm your host, Bridget Norris, and. And today we're diving deep into something that keeps most attorneys up at night but probably shouldn't if they had the right guidance. Our guest today is Frank Rickus, a CPFA who serves as a personal CFO to attorneys. Frank is known as the tax whisper law firm owners, and he's built his reputation on a simple but powerful promise, helping lawyers stop tipping Uncle Sam more than they legally owe. What makes Frank unique isn't just his expertise in tax strategy. It's his systematic approach to wealth building. He's developed what he calls the MBG system, a personal CFO framework that helps attorneys minimize taxes, protect their assets and income, all while growing wealth with genuine purpose. From hockey rings to helping law firms build generational wealth, Frank brings a refreshing perspective to financial planning that goes well beyond the typical rule of thumb. Let's dive in. Frank, welcome to the show. I'm super excited to chat with you today. This is a topic that I think needs to be talked about more and more openly, but also with true guidance. So I'm excited to have you on.
- [01:40]
C
Thanks for having me, Bridget. Been looking forward to it and glad to be here. And let's. Let's get into it.
- [01:45]
B
Yes. So first I'm just gonna say this right from the beginning because I talked about this in the intro, so everybody wants to know, including me. You call yourself the Tax Whisperer, so I'd love to know where that came from.
- [01:58]
C
Oh, just a wild idea that I had a few months ago. I'm involved in a mastermind group and we were talking about different things that we all do, and it came up that I work with law firm owners primarily, and they said that you're. Everybody in the room said the same thing. Your focus should be on taxes because that's what everybody wants to talk about because they're tired of paying them and not a lot of financial advisors want to talk about them or will talk about them. And if that's your quote, unquote, foot in the door, then you should lead with that. So I kind of toyed around with some sort of title, and that's what I came up with.
- [02:41]
B
I love it. So how did you get to the point where you were specifically focusing on just serving law Firm owners versus just generally high income professionals.
- [02:53]
C
Okay, so. Good question. Years ago, when I was working at a corporate firm, I was given what's called an orphan. An orphan is someone who has an account with your company but their advisor left. So it was a law firm owner, a family law firm owner. And I went out to see her. She had some questions about the account that she had wanted to do a couple new things. So we did that, took care of it. She referred me to a law firm owner friend, that law firm owner friend referred me to another lawyer, referred me to another lawyer. A couple of the guys at the office found out that I was working with law firm owners and they had a couple of people that they wanted me to go on a meeting with. So we did that. And it just kind of slowly kept happening over time. And I got to admit, I really wasn't even paying attention to it for the most part. And when I got out of my management role about two years ago, I took a look at my client base and I just said, all right, if I'm going to do some marketing, if I'm going to approach a certain clientele and maybe consider a niche or two, where am I going to go? And after my analysis, it turned out that more than 60% of my clients were either attorneys or law firm owners. So I said, okay, okay, then that's what I'm going to do. And it was, it was as easy and simple, as organic as that.
- [04:10]
B
I kind of love that. It's like as natural as that. It wasn't, you know, there's some crazy story, but. So tell me a little bit about, you know, exactly what you do. I know you talk about that, you talk about taxes, but how is it that you actually help law firm owners?
- [04:25]
C
So I've been a financial services business for 34 years, so I've seen a lot, done a lot, know a lot, and still am learning. I'm learning every day. So I'm always trying to get better, which I think that's important. It's also good for your mind and keeps you active and keeps you current. We do comprehensive planning and I kind of hate that word. I don't like holistic any better, but for lack of a better term, that's what we're going to go with. So from the financial planning standpoint, what we do is we'll look at obviously your taxes and tax planning. I'm not a cpa, so first things first, I'm not doing a tax return or not filing that return. I'm familiar with it but we're going to collaborate with my client's CPA to make sure that we're looking at all the different things that they could be doing either from entity structure, the different tax credits, different deductions that could be taken advantage of. We want to make sure that you're getting as much of that back to you in your pocket as possible. So it's the tax planning angle, it's the risk management, which involves insurance products. So life insurance, disability, long term care insurance when it's appropriate and when the time is right. And it's wealth management. And the wealth management will be on an individual basis or it will be on a corporate basis. Meaning we're using, you know, various retirement plans, 401k profit sharing. And for some of the higher earners who are consistently earning good money, we look at what are called cash balance or defined benefit plans where you can put away potentially up to six figures and save some significant dollars in taxes. We're just waiting on somebody right now who's going to make a contribution and they're going to save about $70,000 in taxes this year. So you do that for 10 years. It's a lot of money.
- [06:08]
B
Yeah, well, and I think you're right. I think it's like when you say financial planner like instantly, like almost kind of almost funny. Sometimes when people have that same reaction to when you say the word lawyer, they either go one direction or another, but when you say financial plan, they're like, oh, okay. So that means they're going to try to sell me some sort of product that I don't need instantaneously. So I think that's the first thing that, you know, bursting that incorrect bubble is, is a necessity because then you're missing all of the other. I think, you know, what you kind of called winging it with your money aspects.
- [06:43]
C
You know, I have this joke, but sometimes I actually pull it off. When I'm on an airplane and I don't feel like talking, someone will say to me, so what do you do? I sell life insurance and conversation is over and I can enjoy my three hour flight and all is good. It's just, there's just sometimes I don't feel like talking. And I know that's probably bad, but.
- [07:04]
B
Oh my goodness, I think I'm going to have to tell my husband to use that one. He travels for work all the time and he's constantly telling me that people always want to talk. I'm going to have to give him that one.
- [07:14]
C
But I won't introduce Myself as a financial planner either. You know, it depends on who I'm in front of. It depends what kind of person they are. But I'll usually say, you know how people are tired of paying the amount of taxes that they pay? Oh, yeah, of course. Well, I help law firm owners, you know, minimize those taxes and they'll, oh, how do you do that? And we kind of get into a little bit of a conversation, but usually it won't take place there.
- [07:36]
B
Okay, so what is. What would you say are the biggest, maybe one or two financial mistakes that you see attorneys making repeatedly?
- [07:45]
C
Ooh, I don't want to get myself in trouble with my people. Well, it. I won't. The first. Let's go three. I don't want to call this first one a mistake. It's not necessarily a mistake. But not making time to look at your finances, you have to know your numbers. Right? You could have a lot of cash coming in, but then if that cash is just going out all over the place with no specific plan, that's a problem. You know, you could have great revenue, but when you look behind the scenes and you have it saved a lot, you have to put away a lot. Things look a lot different. So it's. You have to dedicate some time. Now, having said that, if I talk to 10 law firm owners, five of them at least are going to say, frank, do you know the CPA that's more proactive than mine? It's not their mistake. Right. It just is a fact of life that they're with the CPA and their cpa, all they really are doing is filing their return. So a CPA goes and looks backwards and says, okay, this is what happened last year. Here's what you owe. And that's not really tax planning. So we need to find someone that is a CPA or an enrolled agent that is proactive with tax planning. And I can certainly assist with that. And I like to be involved in that. So that's one thing. The other thing is not having the proper retirement plan structure. If you're making good money, a 401k probably isn't enough. If you have a 401k and a profit sharing plan and you're still making good money and you had more money to put away, you need something beyond that. So it goes back to the timepiece where you have to give yourself time to be educated on some of the things that are out there. Because, look, the money is better in your pocket than it is in Uncle Sam's. So why wouldn't you want to spend 20 minutes on a call with someone that can help you alleviate some of those taxes, save some money, and also put money away for your future.
- [09:39]
B
So when you say tipping Uncle Sam, giving them extra money, what does that actually look like in real numbers? Now you gave an example of somebody who's going to save, you know, 70,000. But when for somebody who's engaged in their numbers or wants to be engaged in their numbers, is there a place that they should be looking first for something like that? Where are they giving away the most money?
- [10:01]
C
Well, they're giving it away probably in a couple areas. It could be the way that their entity structure is. Right. If you're making good money now, what's good money? That means different things to different people. But again, I would collaborate with the CPA on this. Probably if you're making 300, $350,000 or more, if you're operating as a sole proprietor, that might not be the right thing to do. You might consider looking at an S corporation. Right, because there's different things involved in there and different tax savings that you're kind of giving away if you're not established that way. And again, the other thing, it still points back to retirement plan deductions. I hate to emphasize that, but this individual that we're talking about, where I mentioned the 70,000 in savings, it's a contribution of a little over $200,000. And based on everything that's going on with that person and some of the other things that they're doing, that's the benefit that they're going to get out of doing that. Now this person is making, you know, has very high level income, but they're younger. So when we're looking at what we call the cash balance or defined benefit plan, there's a calculation that's based on your age, what you're making, and that's how it's determined what contribution is going to be. But those are the two things that really initially stick out the most.
- [11:18]
B
So, yeah, I think from the lawyers that were open enough to want to look at their numbers and want to walk through things specifically, and for me, not on the, you know, that aspect of it, more of, you know, revenue, profit and your expenses. I did notice something that seems to happen a lot, which is if the owners are paying themselves, whatever it is that they're paying themselves is, you know, on the salary side is a lower thing where they have, you know, distributions that they get, you know, every month or every quarter and then they have a 401k. But beyond that, I don't see any other expenses. And then when I start to think about, okay, number one, you're not, not only are you not planning to sell your firm or looking at a way to build a business that's sellable later, we're just, the money's just going out. I'm like, and after that, where does it go?
- [12:06]
C
Yeah, exactly. And, you know, I, the other thing that I say is a lot of the law firm owners that I work with and even, you know, some of my past clients, they're a little afraid of getting what I'll call financially undressed. You know, I'm going to get behind the scenes and see what's going on. And sometimes I'm catching someone in their second or third year of making good money, but they've been playing catch up because of student loans, because they just bought the next new house, they, you know, needed to get the next new car. And I get that. I fully understand that. But at some point you have to start paying yourself. And one thing that I Talked about on LinkedIn, I guess it was a couple weeks ago, is that, you know, September 15th is rolling around another due date for taxes. Another payment is also coming up soon. The one thing that nobody likes doing is paying those taxes. But what's even worse is not having the money to pay for those taxes. So let's set up a, call it a slush fund, call it a separate account that's just for taxes. And we can determine with your CPA how much goes in there. But every time you get paid, you should put something in there so that when tax time comes, you're not scrambling, you know, for where to find the money.
- [13:20]
B
So, because I think this is a standard where even the most successful attorneys are very detail oriented in their practice, but financially they're reactive instead of proactive. What is the not like, if they decide today, they're listening and they're like, okay, I need to become proactive. Obviously, we're in September, I've got one quarter left of the year. What's one way they can just become proactive?
- [13:46]
C
Well, there's a law firm that I'm going to be working with, has no retirement plan. So we're coming very close to the window where we won't be able to establish it for 2025, but we're going to be able to get in under the radar because plans have to be established. There's usually like a 45 to 60 day setup. So just because you wake up in November and say, okay, I want a 401k for 2025. A little too late, right? There are things after the year, and I know you asked before the year, but there are things after the year is over that we can still do that will count for 2025. So in 2026, up until you file your return, there are still a couple things that we can do that will count for 2025's taxes. Just like the gentleman that's going to be saving about $70,000 on taxes. That's basically based on him not filing his 2024 return yet. However, back to this year, you know, specifically making sure that you've taken in effect all of the deductions that are available to you. With the new tax law that came in in the middle of the year, the one big, beautiful bill. A lot of big changes and a lot of positives in there. If you're looking to buy or buy a car, you might want to buy a car. There's a $10,000 benefit for you there. There's a few things that you got to look at as far as your income is concerned, but at this point, it's making sure you've itemized your deductions. If you have to spend money on anything and you can do it before you're in and it's a true business expense, consider writing a check in 2025 as opposed to waiting until January so that the tax benefit counts for this year. Just look at what you might need to purchase, whether it's equipment, whether it's a membership somewhere you need to pay for, software you need to buy computers, whatever it is, take a look and see what you need to spend on that you can actually get a deduction for this year.
- [15:40]
B
I think that's something. And it's. I think it happens in. Across the industry. It's not just a lawyer thing. But we get. We get to the end of the year and everybody's like, okay, I need to invest in coaching because I need to save money on taxes. So I need to. What do I need to get? Do I need to. You know. So as far as your services are, those are things that are deductible for the attorney as well.
- [16:00]
C
So I'm not a CPA again, so I got to do that caveat in case compliance is listening to me. But if we're working and we're discussing business situations, which invariably we are, and you're going to pay from it, from the business, then generally, yes. If we're doing a financial planning arrangement, which most of the time we are. Then those dollars that you investing for the financial plan will be tax deductible. But again, clear it with your CPA just to make sure. But normally, yes.
- [16:30]
B
Like to caveat this and say, you know, whether you've just started your law firm or whether you've had it for 20 years and you haven't done anything, is the cliche to say it's never too late to start with plans, you know, whether it's, you know, retirement plans or insurance. I'm assuming that applies.
- [16:49]
C
Absolutely. I mean, it's never too late. It's an old phrase, but I work with people that are at different ages. I'm working with people that are at different levels. You know, a lot of attorneys go out on their own, and they go out on their own at various points in their career. They'll do it at 35 years old, they'll do it at 55 years old, and anything in between. So I enjoy helping them because there's a lot going on in their business as they're opening up their firm and they need help in a lot of different areas, and you try to wing it or you try to do everything yourself. You get bogged down with a lot of things, and nobody should be in a position when they say, well, I want to make more money. When I make more money, I'll start working with you. When I make more money, I'll start working with Bridget or I'm too busy right now. When I'm less busy, I'll start working with you. You're hopefully, you're never less busy. You're probably going to be more busy. So I'm not looking for a lot of time spent. And like I tell everybody, the heavy lifting happens up front, and that's when you're gathering all your statements, gathering your documents for us to review. Once you do that, after that, it's pretty smooth sailing. And then the heavy lifting is all on us. So we just need a little bit of extra time on the front side. And then after that, it's really very smooth.
- [18:05]
A
If your calendar is empty or chaotic, my Legal Academy Systems helps fill it with console results, streamline intake, and make marketing easy and measurable. Start your firm's growth journey today. Book a call with us@schedule.mylegalacademy.com Again, that's schedule.mylegalacademy.Com I usually find when people say.
- [18:30]
B
You know, I don't have enough time, or it's those things, it's. That's usually like a mindset thing of being Scared to actually look. I've had so many people tell me that, oh, I. I don't have time to add that one call into my mix. And I'm like, it's one call. We. It's 30 minutes of your day of a month. Like, let's just do the call to see where we're at. And I think it becomes exactly what you said. It's, if I don't see it, if I don't look at the numbers, then it doesn't exist for right now until the end of the year. And then they're. Then you're forced to anyways.
- [18:59]
C
Yeah. And you're right. It is a mindset. I mean, even myself, I find myself sometimes getting involved in, whether it's different groups, whether it's different things. I just eliminated three things at the beginning of the month. I was like, I don't want to be a part of this anymore. Eliminated them because it's not that they weren't good. They're probably good for other people. But either it ran its course for me, or it was no longer something that I wanted to be participating in. And no offense to anybody who might be listening or watching, and he knows that, you know, I left an area or a group, but I have to focus on what's right for me. And I think when it comes to a law firm owner's finances, operations and planning, you got to focus on it, you know, and it's just very important because I'll wait a couple of years. I mean, you'd be surprised how fast two years goes. You'd be surprised how fast six months go. It's quick. And like I say, there's a consequence for everything. Every decision has a consequence. Even not doing something is a decision. And that's a consequence.
- [20:01]
B
A hundred percent. I say that all the time. Not making a decision is making a decision. You're just deciding to, you know, sit there and not move forward, which is, like, the worst thing possible. I. I think people are afraid to make mistakes, but to me, making a mistake is just turn around, go the different direction, and you're good to go. Like, I think that's like the. Especially with new law firm owners, it's. I'm just trying to figure out how to survive, and I'm just trying to figure out how to pay myself first. I don't know how many people I've spoke to that years in, they're finally paying themselves. So to me, this is where we have that conversation of, you've had your law firm for three years. You didn't pay yourself at all in these three years. So you're just kind of surviving. And now you are playing catch up with everything you're paying catch up with, paying yourself with 401ks with considering what you need for long term wealth strategies. I think it then becomes even more scary just because now it's, this is where I'm at. What do I do now?
- [20:57]
C
Because what ends up happening is the numbers get bigger. Meaning what you have to do to get to where you want to be those numbers get bigger. And believe me, I've seen a lot of things in my ear. First off, everything is confidential. And obviously, you know, you're popular on LinkedIn. I'm popular on LinkedIn. I don't ever give away anybody's name or information about what I've done with him or her. If they do that's fine, then, then I'm okay with that. But yeah, it's everything is confidential and I respect that because I would want the same thing for me as well. But I think if it's important and you realize that it's important, then you need to do it. You know, you spend how many hours planning your two week vacation? I know I'm just a little bit of time in your financial future.
- [21:43]
B
I feel like I'm being called out in that right now because we're having this conversation in my home right now about next year's vacation. But we put off our own personal planning that hasn't gotten done yet. Oh, it'll do it next year, I'll do it next year. And I'm like, I'm looking at my husband like, where are those people right now? We are the ones that keep saying.
- [22:03]
C
Happens.
- [22:04]
B
So I want to talk about something that you've mentioned in your content. I kind of found it interesting and I think so. I barely want to touch on the, what you called the Rockefeller method and explaining what that means and how it can actually be applied.
- [22:18]
C
So in very high level terms and very simple terms, the Rockefellers were very good at passing wealth on to the next generation. Right. Imagine if everybody who is a parent left their children something after they passed away to help them get started in their life or help them further their life better. What if then that child did the same thing for that child? And it's just, you know, it kind of creates a snowball effect. In theory, what you're using is you're using life insurance. Right. I know for some people that's a bad word and it shouldn't be because life insurance does Play a role in your financial planning, especially in your estate planning, because how else are you going to create wealth not only for yourself, but for your future? So what the Rockefellers were doing is purchasing life insurance. Obviously, the beneficiaries are, you know, their spouse, their children, their grandchildren. And it just continues on as a way to create generational wealth for the future. And you're putting that next person in a much better financial position than had you not done that. Now, I don't come from a wealthy family at all. The money was very tight for us when we were growing up. My parents were divorced when I was about 9 years old, and they were the epitome of check to check. And it is what it is. But when my dad passed away, he barely had any life insurance. He passed away unexpectedly. When my mom passed away at 97, the only life insurance she had was used to help pay her final expenses. And that's because she had a good advisor help her get one when he came into the business. But I think it's something that it's not for everybody. Right. Some people just can't afford the kind of insurance product that requires you to do the Rockefeller method. And that's okay, that's all right. But when you're making good money using cash value life insurance can be, you know, we'll call it another asset as part of your portfolio. It's insurance first. It's not an investment, it's insurance first. But there is an investment component inside of cash value life insurance that you can use while you're living for your future. But the death benefit is the piece that helps you pass along the generational wealth. And I don't know if a lot of people know this, but Walt Disney started Disney by borrowing money from his life insurance policy.
- [24:45]
B
Oh, wow. I did not know that.
- [24:47]
C
Let's talk about a return on investment. That was a pretty good deal.
- [24:51]
B
Yeah, no, I think I definitely, you know, can feel this whole thing like my family was the same. My grandparents, they owned a business, but, you know, didn't. They were great at what they did, but they didn't know how to run a business. And I got themselves into, you know, tax trouble. And they went through that whole process, you know, that I had to see. And so those. These kind of conversations were never had enough to even. So even if you could afford something, those were not had. So same with them. When they passed, it was just enough to cover, you know, burial expenses. And now I feel like people are having more of these conversations younger, trying to understand it. So I think that that aspect is great, but I still think there's a big education piece that's missing on fully understanding it. And I, oh, my God, the Instagram reels that I see sometimes when they're talking about these things. My husband's like, who listens to this? This is not even right. And I'm not a financial planner. And I'm like, well, you're just. You're trying to reel in. And I agree with getting people to start to want to understand it. I mean, my son is 26, and he'll sometimes randomly call us and ask us some sort of financial question. And I'm like, where is this coming from? And I'm like, don't tell me you saw something on TikTok, I'm guessing.
- [26:07]
C
Yeah. Yeah. I mean, there's a lot of information out there. Some of it's good, some of it is not so good. And you have to be very, very careful where you get it from. It's gotta be a trusted source. You know, you know, the old know, like, and trust. But you also have to have confidence in the person that you're working with who's going to be able to get the work done for you. And that's not an easy thing to portray to a stranger sometimes. And so, like with, you know, you and myself, we're publishing content on LinkedIn, hoping to educate our consumers, the lurkers who never like or comment. And that's fine, that's okay. Eventually, some of those people do come around, but that's the best way to kind of get the information out there. I'm part of a Facebook group in my city, and every now and then someone will say, does anybody know a good financial advisor? Why would you go to Facebook, look for a financial advisor in a group? One you don't have a friend to ask, you don't have a colleague to ask who they use. Sometimes I just find that stuff weird. Or like you said, oh, I saw this thing on TikTok. What do you think? I know. All right.
- [27:14]
B
So typically, if someone decides, okay, this is something that I want to start looking at, I want to start focusing on, and I hate to say this because this is. It's not logical, but we do live in a world of, you know, Amazon, I can have it in an hour, I want to see some sort of results. And I deal with this on a daily basis with, you know, lawyers. In our program, there is no easy button. Things take work and they take implementation and. But if somebody wanted to get started implementing what's the timeframe where they actually start to see they can physically, you know, see the benefits and see the. That their portfolio is increasing.
- [27:53]
C
So obviously we have our discovery meeting. Nice law firm terminology there. Get to know each other. We start to gather information. And right from that point where we gather the information, we can analyze that information, that we have it into our planning system and then we can start making recommendations. And there might be five or six things that ultimately need to happen. Well, I want to focus on the first two that we each feel are going to be the most important. So how soon can we see that taking place? Well, it really depends on how fast the person gets me their information and how fast we can, you know, set up that next meeting. But I would say within 30 to 60 days, we're going to start to see progress. Right. When we're doing a financial plan, we like to deliver the first edition of that financial plan within 90 days. Sometimes it takes a little bit longer because they're busy, you know, especially if you're a trial attorney. Trials come up. I get it. That happens. But within 90 days, ish, it could be a little bit less. We're going to have that first edition of that financial plan completed and then we're going to have quarterly meetings. If you don't want that quarterly meeting, that's fine. You got to tell me. I'm going to asked to have it scheduled. Right. I'd rather be in front of you more than have you say, oh my gosh, I haven't heard from Frank in two years. I don't want that to happen. But it's a give and take. But if you've agreed to work with us, then we're going to be kind of thumb on your back to make sure that we get the information we need, we have the meetings that we need, and we're not talking a lot of time. 45 minutes, 30 minutes, something like that. On an annual basis. Yeah, we'd like to have a deep dive. That's about an hour, you know, and the more we get to know people, those meetings are not all just about your finances. It's talking about family, talking about hobbies, talking about vacation. So sometimes an hour goes quick because we're talking about all that other stuff because we just, we get involved in our, our clients lives and we become good friends and that's just how it happens.
- [29:53]
B
Do you find that you have a lot of. Especially online and you know, this day and age, the people that are skeptical, you know, obviously skeptical of planning. Financial words, financial planning. But Actually coming in and being skeptical about just changing their current financial approach. Like, especially if this is something that's totally different, they're not familiar with it. It's not something they understand, is it? Do you find that you have a lot of that, or do you find that people come from somewhere else and feel like they don't. They maybe have been. I don't want to say the word burned because it's not right, but maybe they didn't get the right information or they just. It didn't go well.
- [30:30]
C
I've had a couple of those situations where they didn't have a good experience. And I like to find out, okay, so tell me what happened? What happened in that experience? What didn't you like about that experience? What would you prefer to have happen? What would you expect out of me? And it's kind of a corny question, but sometimes I'll ask it. Okay, Bridget, in two years, what would have to happen for you to feel like we've had a good working relationship? And then you'll answer, and everybody's answer is going to be different. So the getting burned part, it happens once in a great while, but people often will come to me because they saw something that I posted that resonated. Finally, they have been thinking about doing something and they've been following me for a while. And, okay, they're ready. Or they got referred to me, whether it was another lawyer, another person that's in the law area, you know, for example, someone like you could have referred someone. And the time now is right, but I'll. I'll say, so why today? Sometimes it'll be a situation that popped up. Sometimes it'll be, you know, like a client told me years ago, one of my favorite expressions, he said, frank, it's time for me to grow up financially. So let's get this. Let's get moi. Okay, great. I'm just glad to be in the right place at the right time for them.
- [31:52]
B
Yeah, I think that's some great questions because I think a lot of people don't reflect on, you know, why this specific thing went wrong. Sometimes I also like to. It's a real look in the mirror where sometimes. Maybe it was both sides, maybe it was something else. I think those are great, you know, avenues to start with, but I think so succession planning. Is that something that. For attorneys that are like, I do definitely want to. I mean, I actually had a member once. He was preparing to step back, and I'm like, okay, are you selling? And he's like, no, I'M actually gifting my firm to my employees. And I'm like, I thought that was, like, the most amazing thing I've ever heard. And I'm like, that's amazing. And I've also seen some that, you know, I'm going to step back, but I want to plan to sell. So I'm going to assume that succession planning looks different for everyone, but it's something that's included they need to look at for their future, you know, strategies.
- [32:46]
C
Oh, absolutely. And when is the best time to talk about it? Now. I mean, you wait too long and things can happen and then you don't get those things completed. And one of the things that partners ought to have is what we'll call a buy sell agreement, which covers four or five different events that could happen during the course of your business. Right. If you're a solo practitioner, you need to have a single employer operating agreement. Now, I don't write either of those. We fund those with insurance products to make sure that the money is there to pay at the various scenarios. But you definitely need to have them in place before something happens, because when it happens, it's too late. And I had lunch with a colleague a couple months ago, and he was telling me about a law firm where I think there were four partners and one of the partners passed away. Well, they're still in litigation because there was no agreement and there was no funding for the agreement. And now the widow wants money, and rightfully so, because it was, you know, her husband that was part of that firm, but the planning wasn't there. So it's just a very sticky situation. So you want to avoid that.
- [34:04]
B
So what do we. I have promised two more questions. The biggest, or do you see one? Because I know there's a lot of trends in everything. I mean, obviously we're in the AI world trend. We're in a lot of, you know, things that are happening. But in the financial world, is there any trend that you see that's coming or that's just starting out that attorneys need to kind of prepare for?
- [34:25]
C
Well, I just. It's hard for me to give anything specific, but, you know, I had worked for corporate firms for many, many years, and there's nothing wrong with them at all. So let's get that out in the open in case one of my old managing partners might be watching or listening or eavesdropping on this. Nothing wrong with those. I went to Independence. It'll be a year, September 27th. And I think one of the things that stands out with that is because I'm independent. I'm not tied to any responsibility to a company to offer a proprietary product. I can work with any insurance company. I can work with any investment company. We have free rein. So we can be totally objective. Not that we weren't before. We had some guardrails in the past, but now it's. It's completely objective. And I think that's something that you should look for. Again, nothing wrong with the other firms and companies that are out there, but just make sure that what it is that you're doing, that's what is being offered to you really is the right thing. That's probably the best way I can answer that. Because you want honest recommendations that are for you that benefit you, not the advisor's pocket.
- [35:41]
B
Yeah, I think that that's. I think that's probably the most important thing because that's the thing that's going to make you feel less weary and less worried about this financial plan that you're doing for me is this really. And I think that's probably when you say that the biggest sticking point for most people is you're just go with the assumption automatically that you're just going to recommend something that you have to and this is it. And I think knowing your options is the same thing as we think about when we go to the doctors. Right. Like we. If something comes up and you want a second opinion, a third opinion, I mean, you want to have the ability to have, you know, other options. And I think that that's something that is not. I have not heard it. And I have. I always kind of. I was under the assumption that you had to go with. Whoever you go with has a specific line of things that they have to choose from. And that's it.
- [36:35]
C
It's weird because over the years, people say to a client, you know, who do you have your insurance with? Who do you. Do you have your investments with? 9 times out of 10, it's Frank's my guy. They never name a company. Never, you know, which is why I came up with the Franks my guy hat. So it's. I think it's true that you want to have that objectivity there because it's important. My. My other joke is, here's the plot, Nick 3000. You should have it because everybody else has it. And it's going to solve everything that you have going on in your financial life. And while it might be part of your financial life, it shouldn't be the only answer to everything.
- [37:16]
B
Yeah. So I always like to end the podcast with Giving the attorney something, you know, one thing that they can actually implement and do. I'm a big proponent of just do something. You've got to make an initial step. You've got to make the decision and maybe that is the one thing. They just need to make the decision to start financial planning. But if you could give them one thing to implement, what would that be?
- [37:41]
C
So besides putting on your calendar to meet with a financial advisor for 30 minutes, whether that's me or somebody else, that's one thing. The other thing is discuss with someone whether that's the financial advisor and or your cpa to make sure that you're taking advantage of all the tax advantages that are available to you. And if something's missing or you're not aware of something or you heard about something, then you need to act on that because the money is better in your pocket than it is in Uncle Sam's.
- [38:14]
B
I love it. I think that's a great place to stop and I appreciate you coming on. We will link in the show notes where you can access and find Frank. He's actually active on LinkedIn, so if you want to lurk and start finding out and learning a little bit more, that's definitely the place to go. But we will also link his contact information as well. Thank you so much for coming, Frank.
- [38:34]
C
Thanks, Bridget. Really enjoyed it. Thank you.
- [38:36]
B
Thank you.
- [38:38]
A
That's the Law Entrepreneur for today. I'm Sam Malayi. I appreciate you listening. Subscribe to the Law Entrepreneur for more legal content and practical growth plays.