Many law firms require clients to pay an [simple_tooltip content=’An advance payment, or simply an advance, is the part of a contractually due sum that is paid or received in advance for goods or services, while the balance included in the invoice will only follow the delivery.’]advanced fee deposit[/simple_tooltip]^[1] or a [simple_tooltip content=’A security deposit is a sum of money held in trust either as an initial part-payment in a purchasing process.’]security deposit[/simple_tooltip] retainer^[2] – a sum of money paid up front to be held in trust and to be used to pay invoices if the client fails to pay. As representation continues and fees climb, however, attorneys can rapidly find themselves in a situation where the client owes thousands of dollars but has no money left in trust to cover the outstanding invoices.

An [simple_tooltip content=’An evergreen retainer is a type of security retainer. Just like other types of retainer, 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 evergreen retainer, your client needs to keep a predetermined minimum balance on the account.’]evergreen retainer[/simple_tooltip] – a retainer where the clients must replenish the trust funds if they fall below a certain amount – allows attorneys to ensure that there are always trust funds available to pay the most recent invoice.^[3][4] Good legal billing programs will show both the payment from trust and the requested trust replenishment amount on the client’s invoice:

References

1. Managing Client Trust Accounts
2. When Choosing a Retainer Option, 4 Types Stand Out
3. Tips For Improving Your Law Practice Cash Flow: Evergreen Retainer
4. Fee Tale: This Is Not Your Father’s Engagement Agreement