Billing Software: Explore your Options

Billing Software: Explore your Options

Among the many questions you may have about billing a client, two are key to your firm’s practice management: (1) How do you bill – hourly, flat fee, contingency, etc.? and (2) How does the client pay you – via emailed invoice or hard copy, check or credit card? The type of program you use to track your time and calculate your bills will vary depending on your answers to these two questions. Note, there exists software that may have time tracking capabilities in addition to other functions, but for now, I will focus on only the specific software for billing. You have your choice of options for billing-specific software, but you should consider the following details when making the decision which to use for your practice.

Clients and Practice Areas

Your billing methods have been developed to fit your clients and your practice area. Hourly billing has long been a staple in legal practice, while value billing, on the other hand, determines a reasonable price for the product or service being offered. Value billing is more common in more transactional practice areas and provides the principle behind flat fee billing. As a previous practitioner of family law and estate planning, I have seen both types of billing used in the same firm for the same and different clients. Some clients are more willing to pay for a will package if they know it will only cost a flat fee, whereas for family law, it is more sensible to charge a retainer and hourly fees because any case can be unpredictable. Your unique practice may need a wider variety of billing structures depending on your particular clients and the scope of your practice areas.

Billing Structures in Software

Because of your firm’s specific billing types, your software should be chosen with those structures in mind. The advent of technology produced an abundance of billing software features. Having a program that tracks your expenses, billing entries, and client payments can vastly simplify your administrative tasks. One of the newer developments is a system that captures the time devoted to a particular activity and the case name, so you never have to worry about missing time for that reviewed document or read email. Not all software is created equal, though. Developers of certain programs have specifically designed and updated their software with each new technological and legal practice development. The software you choose should fit your firm’s billing structure, as well as make it easy for your clients to pay their invoices.

Customization Options

The other key to keep in mind is that of customization. If you want to be sure your clients can pay through any means possible, you should look for a program that takes checks, credit card payments, and ACH payments (bank direct payments). Another customization you can include is automatically mailing the monthly invoice to the client. Some billing programmers even developed a feature that warns you when certain accounts are low, which could be very useful when working on a retainer agreement that requires periodic payments to your lawyer trust account. Would you like to modify your invoice’s header or columns? You might want to be able to provide variations on the six-minute increment. These are just a few of the customization tools to consider when shopping for billing software or talking with your current billing software provider.

If you don’t currently use such a software, the comparison chart below provides an overview of some of the major features along with the estimated cost of each program. Major features like time tracking and expense tracking are crucial. Unlike individual billing, batch invoicing allows you to process all client invoices at once. A majority of programs integrate with an online credit card processing program, like LawPay, if they don’t take online payments themselves. A new feature lets you set up a payment plan for clients, which can be especially useful in hourly based practice areas or with “evergreen retainers” (those agreements requiring the retainer to be refreshed). Another modern functionality offered by some desktop programs is a mobile app connected to their software, enabling you to view or edit the client’s bill even if you are away from your computer.

Research Your Choices

Ultimately, you should know what you are getting out of your billing software. If you aren’t sure what options you want, it’s worth it to you and your clients to investigate. Most of the listed programs offer a free demo, or possibly a free trial of the program. If you know you want or need a specific feature, ask the product representative. Companies love talking about their software, and you will love having a program that works for you and your clients.

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