July 18, 2025 • 36 mins
High income, low net worth—it's the dirty secret plaguing many successful family law attorneys. In this J Sterling Hughes Insider episode, Darren Wurz, founder of the Lawyer Millionaire Founders Network, reveals why attorneys making $500K+ annually still struggle to build wealth and his proven three-step system that's transformed hundreds of law firm owners into true millionaires.
Drawing from over 20 years of financial planning exclusively for attorneys, Darren exposes:
- The overspending trap that destroys wealth in both business and personal finances
- His exact three-step framework: stabilizing business finances, maximizing profitability, and growing wealth
- Why family law attorneys face unique wealth-building challenges due to irregular cash flow and high stress
- The critical hiring strategies that unlock wealth-building potential while scaling your practice
- Why making your first million is often easier than keeping it—and the mindset shift required for wealth preservation
Listen in for the complete blueprint to achieve work-optional status while building a thriving family law practice, including real client examples and specific investment strategies that account for the unique challenges of family law practice.
-------------------------
Go to: www.JSterlingHughes.com for tons of Family Law Practice resources.
My purpose is to Empower Family Law Attorneys so they can build a beautiful family law practice and have the practice of their dreams.
I share my family law firm’s secrets, tactics, and strategies of how we have grown from 0 to 25 attorneys and over $15m in revenue in our first ten years.
When I am not podcasting, I am the CEO and Co-Founder of SterlingLawyers.com.
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Transcript
Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
Speaker 1 (00:00):
Is it harder to make your first million or to keep it
?
Speaker 2 (00:03):
For business owners it sometimes can be harder to
keep it.
Speaker 1 (00:06):
One of my first businesses was outside of law.
I was a lawyer, actually, and Istarted it and we ran that
business to $23 million, I think.
And I was just thinking, Ithought I was all that and we
did it because I'm justbrilliant and I'm super smart
and I'm the guy.
It was anything but that.
Speaker 2 (00:22):
It was like luck plays a role, whether we like it
or not.
Being in the right place at theright time, talking to the
right person, that could landyou a really high paying client
Right.
Speaker 1 (00:31):
So well, hello.
Welcome to the J SterlingHughes show, where we share how
we have built our family lawfirm from zero to 27 lawyers and
16 million in revenue in thepast 10 years, and my purpose
here is to document what'sworking and what's not working,
with hopes that you can takethat, recontextualize it and
have the family law firm of yourdreams.
(00:52):
My name is Jeff Hughes and I'myour host, and I have a guest
today.
I'm excited to have thisconversation.
I hope they'll learn a lot,darren, but my guest is Darren
Wurz.
He is the founder and leader ofthe Lawyer Millionaire.
He is the founder and leader ofthe Lawyer Millionaire Founders
Network.
He also wrote a book that waspublished by the ABA.
It's entitled the LawyerMillionaire the Complete Guide
(01:16):
for Attorneys on MaximizingWealth, minimizing Taxes and
Retiring with Confidence, and hehas a podcast, the Lawyer
Millionaire Podcast.
And, darren, I think you and Ifirst met on Facebook.
I had seen your not Facebook,definitely not Facebook.
Speaker 2 (01:29):
LinkedIn.
Speaker 1 (01:30):
And I'd seen your posts over quite a few months,
maybe a couple of years even,because I think we follow a lot
of the same people.
So that's how Darren and Iconnected.
And, darren, I got real quick.
I got to just tell the story,this hasn't happened before you
reached out and said, hey, I gotreal quick, I got to just tell
the story, this hasn't happenedbefore.
You reached out and said, hey,I think I have a lot to offer
for your guests.
And I didn't really see it likeobvious.
(01:51):
I'm really focused on familylawyers and I really want to add
value to family lawyers.
I said, no, I don't think it'sa great fit, or what can you
offer family lawyers?
And you shot back a realspecific value add list and I go
okay, that's something I couldbenefit from.
I know my audience can too.
So welcome, darren, I amexcited to have you.
Speaker 2 (02:15):
Yeah, I'm excited to be here, Jeff.
Speaker 1 (02:17):
Thanks so much for bringing me on.
I'm excited for ourconversation today.
Good, so, now you have a firmand just real quick, high level.
How did you get going in it?
What?
What led you to start a firmfocused on helping lawyers save
their money and retire well, soAbsolutely so.
Speaker 2 (02:34):
our firm, the Lawyer Millionaire Founders Network,
we're a financial planning firm.
We focus exclusively on workingwith law firm owners.
So those are you know are somefamily law firm owners, but a
variety as well.
How it began?
I kind of have a long history.
I started out as a verycommunity-based financial
(02:56):
advisor and I learned about theidea of niching and having a
really focused target market.
I just happened to have a lotof lawyer clients and so I
decided to focus on legal, butthen I learned legal is too
broad.
There are so many differenttypes of lawyers.
You know there's big law,there's owners, there's solo
(03:18):
attorneys, right.
So we decided to focus on lawfirm owners and it was really.
I saw it as a great opportunitybecause I saw a great need there
.
There weren't many financialplanners talking about law firm
owners.
You see a lot talking aboutbusiness owners in general,
retirees and things like thatbut I saw a great need there and
(03:41):
actually I started to have lawfirm owners coming to me asking
for help and what I noticed isthat they were making really
good money high six to sevenfigures in personal income but
they didn't have like they'remaking a million dollars a year
in income, maybe, but theydidn't have a million dollars
yet, right?
(04:02):
So that became my mission washow can we help these folks
really be intentional aboutbuilding wealth and it's cool
because it's a cross betweensome business planning and some
personal financial planning.
Speaker 1 (04:18):
Yeah, and that's where it gets really fun.
I'm real curious.
So these, these lawyers thatwould that you would run across,
that had like great income buttheir balance sheet sucked, like
they weren't able to reallyaccumulate.
If you can look back andsynthesize it down to one or two
things that you saw that theyconstantly did that was a
mistake, what would that be?
Because I'm all ears on thisone.
Speaker 2 (04:41):
It would be overspending at its core.
It would be overspending at itscore right.
But let's break it down alittle bit more.
First, in your business.
I mean, we all know it's easyto overspend personally, but
it's easy to overspend in yourbusiness.
We sign up for so many things.
You know, and I think law firmowners, business owners in
general we're focused on revenue, we're focused on growing
(05:02):
revenue, but I think oftentimesthat comes at the expense of
really being intentional aboutmaximizing profit in our
business, and so we really haveto be disciplined in how we're
managing cashflow and managingour business.
There's just a lot of there's alot of overspending.
It's easy to sign up.
Speaker 1 (05:20):
Were they overspending in their business
more in their personal life?
More which one was, was thebigger culprit?
Speaker 2 (05:25):
Both it's both.
Speaker 1 (05:27):
Yeah, I tend to be all overspend, aggressive, all
gas.
In the business side I'm morefrugal personally.
I just see everything as anopportunity.
So are you?
I mean like, okay, that's justa different mentality that leads
to the same path.
I mean, I've been at the highincome low balance sheet before
(05:48):
and I think that was my problem.
So how do you coach theselawyers through that and get
them to think differently about?
Speaker 2 (05:53):
that you know you're right, it's a mindset.
You know we can talk about thenumbers all day long.
I mean, at a basic sense, we dowant some awareness, because I
find so many law firm ownerscome to me and they're like you
know, I'm making all this money,but where is it going?
So let's find the leaks.
Let's find the leaks in thebucket, because there are leaks.
There are things you've signedup for that you're paying for,
(06:15):
that you're not using anymore.
You know there's money that'sgoing out the door.
So just having an awareness ofwhere the money's going is step
one.
Step two is really figuring outwhere you're happy.
The biggest trick in life,according to Morgan Housel,
author of the Psychology ofMoney, is to get the goalposts
(06:36):
to stop moving.
It's so easy.
I mean, as business owners, weare very aspirational, we're
very excited, we have big ideas,right.
We have big goals, big dreamssometimes, and that carries over
to our personal lives.
So sometimes we get a littlebit ahead of ourselves.
There's an interestingcorrelation between happiness
(06:58):
and money.
They're correlated to a point,but beyond a certain level of
income they diverge.
The happiness doesn't increaseproportionately with your income
, right, a certain level ofincome does increase happiness,
but beyond that it doesn't.
So figuring out at what level-.
Speaker 1 (07:18):
What's the number for that?
Is there a number like oncepeople get to 90,000 a year in
income?
It's the diminishing returnsets in.
Speaker 2 (07:27):
Yeah, I'm not.
I'm not sure and probably hasgone up you know inflation has
gone up right, I think it'ssomewhere.
At least last time I checked Ithink it was somewhere right
under a hundred thousand,something like that.
Yeah, so figuring out thatplace at which you are happy,
right, and you have a stablelife and you can, you can kind
(07:49):
of maintain that lifestyle andnot continue to expand it, and
then let's save the gravy on top, you know, let's invest that
and let's grow that.
Speaker 1 (07:57):
Yeah, so overspending .
And so when you take in aclient that you start to work
with what, what is your processor game plan to kind of get them
through?
How long does that typicallytakes?
I mean, I know the first thingyou're probably going to say is
just being aware of what you'respending your money on and then
(08:18):
and then firmly establishing thegoalposts.
I'm guessing that's what you'regoing to.
I'll let you say it.
So what would that be?
Speaker 2 (08:24):
Yeah.
So our process we try to getlike an initial plan put
together in the first threemonths of our engagement just to
kind of have the bare bones,and then we'll deep dive into
other areas.
The way I kind of see it,there's a three-step process.
I mean we want to hit certainthings right away.
You know, in the investingworld, earlier you start, the
(08:47):
better, right, because you havetime is your biggest factor in
terms of the growth of money.
But there's really like threesteps, you know.
And first we've got to get thebusiness stabilized.
We've got to get the businessgenerating the revenue that it
needs to generate and generatingthe profit that it needs to
generate.
Some people are not ready yetfor really focused financial
(09:08):
planning because they're justdrowning in their business.
Speaker 1 (09:11):
Yeah, can I double tap on that for a second?
I'm curious on what?
What are you running into now?
Let me see if I can ask thisquestion better.
When you say the first step isgetting the business stabilized,
that sounds like businesscoaching, going far beyond
estate planning.
And let's just bring it on thefamily lawyers where I live.
(09:32):
So if a family lawyer comes toyou, darren, and they're like,
hey, I really need some helpwith my finances, what are you
seeing a lot of times that youhave to help them stabilize, and
then what does that look like?
Speaker 2 (09:46):
Well, step one is separating the personal and
business finances.
I don't know if you see this insome of the family law owners
that you work with, butoftentimes when you start a
business, you start a law firm,you might not have all the
infrastructure in place and somaybe you have a lot of business
(10:07):
expenses still happening onyour personal accounts or
there's money flowing back andforth between personal and
business.
So that's that's really stepone, and I do get a lot of
pushback there sometimes becauseyou law firm owner will be like
, yeah, but my business amexgives me such great rewards or
(10:28):
my personal amex gives me suchgreat rewards, I want to put all
my business expenses on that.
It's like, well, the value ofhaving those things separated
and the clarity that that givesyou I guarantee you, guarantee
you it's more valuable than therewards that you might get.
Speaker 1 (10:46):
I totally agree, and I think family lawyers struggle
here because they see theirbusiness as an extension of
themselves and if they have thatline of sight, like that's a
business that's separate from mypersonal it gives them clarity
on where to focus some of theirefforts on their growth of their
business and I see the growthof both.
I think that's I didn't saythat great, but having that
(11:11):
clarity, being able to seewhat's my business, what's my
personal, I think is invaluable.
Speaker 2 (11:16):
You need to know what your numbers are.
Yeah, at the end of the yearyou need to know.
Okay, so step two.
I could give you all the steps.
I'll just give you a few StepNow.
Okay, so step two, I could giveyou all the steps.
I'll just give you a few.
Step two is pay yourself.
Pay yourself a normal, regular,automated salary.
So many owners are just takingmoney from the firm when they
(11:37):
need money and then they'reputting money back into the
business when the business isrunning low, right, and that
just becomes a nightmare and youcannot build wealth on that
instability.
You need to create stability inyour business.
Now, you know family law is,you know, like other types of
(11:58):
law.
Your income can fluctuate.
You know you can have dramaticchanges in your revenue and so
that can be difficult.
You've got to build reserves onthe business side.
You've got to build reserves onthe personal side, but getting
that owner's compensation downfrom the get-go that's another
aspect of clarity.
If you're not paying yourself amarket wage, you don't really
(12:21):
know if you're truly profitable,right?
So that's the other thing is,you know, really trying to build
in some stability in your cashflow, some regularity in
otherwise usually somewhatirregular cash flow.
Speaker 1 (12:36):
Yeah.
So after stabilizing the biz,what comes next?
Speaker 2 (12:42):
Step two is, yeah, is maximizing profitability.
And that's where we start tothink really carefully about tax
planning and really beingstrategic with our dollars in
our business and our personallife.
So really tracking the cashflow more effectively, setting
up cash flow systems that aregoing to help us, like the
(13:04):
Profit First system I'm sureyou're probably familiar with
that.
We love the Profit First system, you know just having a
framework and a structure foryour cash flow that's going to
allow you to really prioritizethat profitability.
And I call tax planning aprofitability exercise.
(13:25):
The purpose of tax planning ismaximizing profitability because
that's what it's doing it'sreducing your biggest expense,
which is your taxes.
Speaker 1 (13:33):
So when you talk about profitability, you're
talking about the amount ofmoney left over after you're
paying yourself right.
So call that a distribution ormaybe a dividend I guess one of
those two and the idea would beto maximize the amount of money
the law firm is spinning off andyou'll do tax planning to help
(13:54):
with that.
Do you get beyond that, likeinto the actual business and how
the money's being handledwithin the business and expenses
are flowing through?
How deep do you go there?
Speaker 2 (14:05):
Well, we can go as deep as clients want us to go.
Oftentimes our clients willhave other partners that they're
working with, like a bookkeeperor maybe even, if you're at the
level you need it, a virtualCFO.
We're big fans of that.
I mean, we don't reallynecessarily want to do that work
specifically.
So, you know, at a certainpoint we will recommend bringing
(14:27):
on um, a virtual cfo or, youknow, fractional cfo or maybe
even a full-time.
You know, if you need it, um,because they will help you
really be intensely strategicwith how you're using the money.
You know, when you get to acertain revenue level, you're
the 10 million revenue level.
(14:47):
You can't play games anymore.
I mean, you need to be able tovery accurately and precisely
predict cash flow.
You have a whole team that'sdepending on you for payroll
right, so you've got to be ableto know where you're headed and
make decisions based on that.
Speaker 1 (15:07):
Yeah, I can tell you that we went through all those
iterations.
We didn't have any of that.
We got a fractional CFO, likearound 12 million, and that
didn't really help us a wholelot.
We had a big top line, nothingon the bottom line, and it
wasn't until we got a full-timein-house CFO at at uh, at, I
(15:32):
think, 15 million, and we took ahalf million or we dropped back
like a half a million bucks butthen our bottom line tripled,
having that disciplined eye onour finances, so huge believer
in what you said about that.
That counters my recklessnesssometimes where I'm all gas and
(15:53):
not really paying attention towhat I need to.
So, ok, so second step in yourprocess is helping the lawyer
maximize the profitability oftheir firm.
What comes after that?
Well, hello, jeff, here my teamand I put out a weekly
newsletter designed for familylaw practitioners to help you
grow and build your practice.
So if you go to my website atjsterlinghughescom that's
(16:17):
H-U-G-H-E-S, that'sjsterlinghughescom and subscribe
, it would mean the world to meand what I will do for you there
is.
I will send you weekly contentto help you build and grow your
practice, as well as news anddevelopments in the greater
world of family law.
Thank you, and back to the show.
Speaker 2 (16:34):
Yeah, the third step is growing the wealth, and
that's really the final step inthe three-part series.
Honestly, we want to startgrowing the wealth earlier, but
you know, once we to startgrowing the wealth earlier, but
once we've gotten the businessin a good place, we've got
really good profitability, thenwe're in a really good place to
really pour some gasoline onbuilding the wealth right and
(16:56):
making sure we have a reallygood investment strategy, making
sure we're making really smartinvestment decisions and I'm not
just talking about stocks andbonds right, maybe at this point
it's time to invest in otherbusinesses.
Maybe it's time to look atprivate equity.
Maybe it's time to look at realestate and diversify our income
streams different things likethat.
(17:18):
So it's about trying to getyourself in a place where you
are work optional and that'swhere we want to get to.
Speaker 1 (17:29):
So what's work.
Optional mean you don't have towork, you have the option.
Is that what that means?
Speaker 2 (17:33):
That's correct.
Speaker 1 (17:34):
That's correct.
Speaker 2 (17:35):
Yep, you know it's.
Retirement is not reallysomething that I find a lot of
law firm owners are reallythinking about.
I mean, they're familiar withthe word and they know they need
to do retirement planning, butthey're not thinking I want to
retire at age 65.
You know what I mean.
You find that the case.
Speaker 1 (17:55):
Yeah, I see that all the time with people in my world
where they hang on a little bitjust because they like the
income.
They don't really know when tostop and so it's challenging.
Speaker 2 (18:07):
Right.
So we want to get your moneyworking for you in a place where
and get you to a place whereyou no longer need the income
from the business.
That's where I really want toget to.
You've got the assets built up,assets built up, you've got
(18:28):
things compounding and providinginterest and dividend income in
the background, so that you'rein a place where you could step
away if you want to, and thatreally puts you in a great frame
of mind.
Speaker 1 (18:35):
How do you go about relative to family lawyers,
darren?
Because in our world most ofour firms are small.
Frankly, a couple lawyers thatreally on average at most.
That's pretty normal and that'skind of tough to get to the
point where you work optionalwhen it's maybe you and a
partner or you and an associate,like how do you help them work
(18:59):
through that and get to thatlevel?
Speaker 2 (19:01):
Well, it's a combination of thinking about
your business and your financesright, because you're right In
family law.
You've got so many things goingon.
You've got mediations, you'vegot court appearances and your
clients are going through a timeof crisis, right, and so they
need you, and oftentimes theydon't.
(19:22):
They don't necessarily havelegal questions, they just want
somebody to talk to, and thenyou've got it's a very
contentious, oftentimes type oflaw that you're dealing with.
So the emotions are high, thestress is high, plans get
changed all the time.
Speaker 1 (19:47):
So talking about their retirement plan, their
dates and things like that?
Speaker 2 (19:50):
get changed a lot.
You see, oh no, I'm talkingabout like, like work, you know,
like you know things like that.
So you've got to have help.
I think you really have to havehelp in your business If you're
going to get to that placewhere you could step away.
I mean, you might have thefinancial resources, you might
get to a place where you havethe financial resources to get
there, but you really have toalso build it into your business
(20:13):
.
So at some point you're goingto need to hire an attorney or
an associate who can start doingthose court appearances for you
.
You we just had a family lawfirm owner on the podcast who
has a very large family lawpractice and she had to cancel
our meeting because she gotpulled into a mediation at the
(20:35):
last minute.
You know what I mean.
So that kind of stuff canhappen in family law and you got
to structure your business in away where you can get out of
that that need for you to beinvolved.
Speaker 1 (20:50):
So you were talking I'm curious on the building the
wealth part.
So your your third step andthat's obviously the longest,
because once you get there itjust becomes something.
You stay with the lawyer foryears and help them build their
wealth.
But you mentioned a whole lotof different types of
investments, and Is there oneclass that you focus on more,
(21:11):
that you're more of an expert inthan others, or can you kind of
unpack?
Speaker 2 (21:17):
that.
So probably our highestexpertise is in your traditional
portfolio of stocks and bonds,right, yeah, and I find there's
a lot of myths around investing,even in this day.
I mean, I've been around formany years in this business.
(21:37):
In fact, my dad was a financialadvisor and his dad before him,
so we have a long history inthis business.
And years and years and yearsago, you would typically invest
through a broker.
You would buy stocks and youwould pay commissions to buy
these stocks, or you would buymutual funds and they had these
(21:58):
5% upfront charges.
Well, we've seen costs come downso dramatically in the
financial industry and it'sfantastic for consumers, for
consumers.
So my golden advice is passive,indexed investing is really the
best way to go.
Are there funds that sometimesbeat the market from time to
(22:26):
time?
Yes, there are, but the thingis consistency, right.
Is that going to happenconsistently?
So here's the thing I canafford to not be the world's
best investor, but I can'tafford to be a bad one.
That's the thing, right.
So I need a really good, solidindex portfolio that's going to
(22:48):
deliver strong returns over thenext 20, 30 years.
I can dabble, you know, with asmall amount of the money, but
we need to make sure we've got areally solid investment plan in
place.
I find that sometimes, whenyou're at a certain income level
, you start to think that youneed certain exotic strategies,
(23:11):
you know, and those can beappealing, but don't miss the
basics.
You really need to have a goodfoundation of the basics.
Speaker 1 (23:17):
Yeah, it seems to me and I'm not a, certainly not an
investor but the world's bestinvestor one year is a crappy
investor, the next year and it'sthe.
It's that consistent justblocking and tackling over many,
many years that makes thedifference.
Speaker 2 (23:31):
right, that is a hundred percent true, and you
know we've we've tried differenttactical strategies.
So a tactical strategy is onewhere you're going to, you know,
shift your allocation.
Maybe you're going to go intostocks, you know, because stocks
are looking good, theindicators are good, and then
you're going to get out ofstocks when the indicators are
(23:53):
not good, because you want toavoid a market decline.
And you see these right?
You see these newsletters.
These people have thesenewsletters and they put out
about how their strategy right,if you would have followed this
strategy for the last 15 years,you would have beat the market
by 400% and you would haveavoided the 2008 crash.
But the golden question youhave to ask is how long has real
(24:20):
money been in this strategy?
That's the only thing thatmatters.
And when you look at that andyou're like, oh, you've only
actually been using this for thelast year, well, what were you
doing before that?
Speaker 1 (24:33):
Okay.
So they're coming up with somestrategy and then looking back
in history and say, well, if I'dhad this strategy 15 years ago,
I'd be a trillionaire today.
Speaker 2 (24:43):
Yeah, it's a fallacy called overfitting, because
anyone can look at history andcreate a strategy that would
have done fantastically well.
Well, whoop-de-woo, we don'tknow how it's going to do.
Going forward, it might suck.
Going forward, yeah.
Speaker 1 (24:59):
One of the things we talked about a little bit before
the call and then on your emailwas helping family lawyers
scale their firm and build it.
I love that topic.
A lot of what I do is aroundthat, so how do you support
family lawyers in doing that?
Speaker 2 (25:14):
So you know we will help our clients think
strategically about steps theyneed to take um in that hiring
process.
Um, some of the biggest things Isee, um, I see a reluctance to
hire people virtually.
Um, and certainly you knowthere's there is aance to hire
(25:35):
people virtually, and certainlyyou know there's there is a
value to having people in person.
But if you are able to expandyour thinking a little bit like
I have one family law client,I've been trying to get him to
hire an executive assistant foryears and he won't do it.
And I'm like, I'm like, if youcan just do this one thing a
virtual executive assistant whocould offload some things for
(25:59):
you, like checking your emails,maybe doing some social media
for you, maybe creating anewsletter for you and having
that eat these are the basics,right, you know.
So, thinking through who weneed to strategically hire and
when, maybe it makes sense tobring on an actual attorney and
really start expanding andgrowing things in terms of
(26:23):
billable work, yeah, so that'sthat's kind of where we help
Thinking about how you'regrowing the team.
I'm sure that you're probablymuch more of an expert in that
area than I am.
Speaker 1 (26:37):
Well, that's a great service, though, because I do
see that with family lawyers weget kind of reluctant to want to
make the investment.
But it requires that if we'regoing to continue to grow and
offload some of that work.
Speaker 2 (26:49):
But you don't have to be scared.
It doesn't have to be a hugeinvestment.
You can bring people onpart-time, you can bring people
on as a 1099 and then transitionthem to W2 when you're ready
for that.
So it's not and you want tothink about where your time is
best spent?
Right?
If you're doing you know, ifyou're doing $15 an hour work,
you're not optimizing your time.
(27:12):
Now I will tell you right, whenyou're building the team, let's
think strategically about yourclients and what they need,
right?
So many attorneys think.
So many law firm owners, smalllaw firm owners think that their
first hire should be anattorney.
Yeah, maybe, maybe not right?
I can see where they'll bedoing billable work and that'll
(27:34):
be great.
But at the same time, attorneysare expensive.
Let's be, real.
So think about some othersupport staff.
One of the most innovativethings I've heard is bringing on
a life coach or a divorce coachto work with your clients,
someone who they can just talkto and unload to and who can
(27:58):
help them navigate some of theemotions of that process.
I think that's a fantastic ideaand that would free up some of
your time to be able to do a lotmore of the actual legal work
and be a great service, a greatvalue add potentially to your
clients.
Speaker 1 (28:16):
Yeah, the Merrill Law Firm in Chicago has recently
done that and, according to thepost, it's going well, and we've
kind of talked about that.
I can see that being a workablething.
We haven't pulled the triggeron it yet, though.
One thing I was thinking abouttoo in preparation for our
conversation, darren, was infamily law.
(28:37):
I mean, we see, unfortunately,people really go through a
really hard time, and part ofthat is they make a lot of poor
financial decisions, especiallyas they're coming out of their
divorce, and they want to kindof get back to the same
lifestyle they had before, orthey want to keep the house when
they shouldn't keep the house,and so we we have a front row
seat in a lot of these kind ofshoot yourself in the foot
(28:58):
financial moves.
Have you seen family lawyerstreat their work with you
differently on average rightVersus other lawyers?
Because of the insights we havewatching some of our clients,
I'm just curious if there's ahigher education level in the
world, in the real world of hardknocks from the family lawyers
(29:19):
coming to you.
Speaker 2 (29:21):
I don't know, I don't know about that All right.
Speaker 1 (29:24):
So that's just my fantasy.
Thought that maybe that wouldbe the case, okay.
Speaker 2 (29:29):
In my experience, it might be the opposite.
Speaker 1 (29:31):
Oh, okay, tell me about that.
Why?
Why do you think that?
Speaker 2 (29:35):
I think maybe it has to do with the level of if
you're doing all the client workand you're deeply involved in
the process.
I think it may have to do withjust the, the emotions and the
stress of of the work.
Um, I I find that maybe that,maybe that has an effect on how
(29:56):
you manage your finances.
Maybe it causes you to be alittle less disciplined in your
investments or your, yourfinances, because that stress
just carries over.
You know, like we need to blowsome money because you know
we're, we're stressed out.
Um, I have, I have one familylaw client who I, I, what I see,
(30:20):
jeff, that really um, that Ifind troubling is clients who
who just kind of been stuck inthe same place for so many years
, and those are the ones Ireally want to liberate.
I find yeah, I find that a lotwith family law too, because it
(30:43):
is kind of a stressful type oflaw.
So a lot of folks are kind ofreluctant to grow necessarily.
A lot of folks are kind ofreluctant to grow necessarily.
So you've got to really beintentional about how you're
managing your stress load andtake progress right.
I mean, we all do these, youknow 10-year vision, five-year
(31:06):
goals, whatever, and that'sgreat, but I like to put a
number on it, like how old willyou actually be in five years?
Okay, now let's think where doyou want to be then versus now
and let's get there right.
Let's get out of being stuck inthe same place for so long.
Speaker 1 (31:22):
Yeah, is it harder to make your first million or to
keep it?
Speaker 2 (31:30):
Well, it is certainly hard to make the first billion.
Speaker 1 (31:32):
Yeah, it's hard, I get that, but I'm talking
relative to each other.
Yeah, it's harder to make it orkeep it.
Speaker 2 (31:42):
For business owners, it sometimes can be harder to
keep it, and the reason is theskill it takes to create money
in the first place is notnecessarily the skill it takes
to keep it.
And the reason is the skill ittakes to create money in the
first place is not necessarilythe skill it takes to keep the
money after you've made it,because the skill to keep it is
all about discipline and cautionand being a little bit more
(32:07):
conservative, whereas the skillto grow it, you know, is risk,
you know opportunity, you knowthings like that, you know.
So, yeah, here's a great story,right?
Have you ever heard of thestock trader Jesse Livermore?
Speaker 1 (32:21):
No, he's got a cool name.
Speaker 2 (32:23):
Yeah, so he was a stock trader during in the 1920s
and he was I think he was theonly stock trader who shorted
the market on Black Friday whenthe market crashed.
Okay, so, overnight he becamethe wealthiest man in the United
States and then, but theproblem was, after that he
(32:47):
thought he was invincible,invincible, and so, you know, he
died basically penniless.
He made all this money.
He made all this money taking arisk, taking a bet, you know,
taking advantage of anopportunity.
But then he didn't change hisperspective and think, okay, now
(33:08):
it's time to protect what Ihave and make sure that I keep
it.
The same thing happens in ourbusinesses, right?
Sometimes we're so focused onpouring fuel on the fire and
growing, and that's great, butat a certain point we have to
change our perspective a littlebit and start to really think
about maximizing profitability.
Now it's time to really makesure we're keeping a lot of this
(33:30):
money that we're making.
Speaker 1 (33:31):
Yeah, I can identify with that.
I one of my first businesseswas outside of law.
I was a lawyer actually when Istarted it and we ran that
business to 23 million I think.
And you know, I was justthinking, I thought I was all
that and we did it because I'mjust brilliant and I'm super
smart and I'm the guy.
It was anything but that.
(33:53):
It was like I took a risk.
It happened to land on red whenI bet red and it was so hard to
hang on to that and you know,eventually eventually rolled the
business right back down to acouple million before I sold it,
so did not maximize what I hadbeen.
I just didn't have thediscipline, like you said.
Well, and.
Speaker 2 (34:13):
I think we often we forget to acknowledge the role
that risk, does risk and luckplay in building a business.
Yeah, luck plays or plays arole, whether we like it or not.
Being in the right place at theright time, talking to the
right person, you know that youcould land you a really high
(34:34):
paying client right.
So there is a bit of luck andwe've got to let that give us
some humility in how we approachour business.
Speaker 1 (34:42):
For sure.
Last question I'm just curiouswhat's the wildest?
Is there a story that sticksout to you where a lawyer came
to you and wanted to allocatesome of their resources to some
wild harebrained scheme?
Have you ever had any of that?
Speaker 2 (34:58):
Let's see Wild harebrained schemes.
I have seen some right.
So I have one client that doescivil litigation defense and
he's in the same boat, you know,making a lot of money but
struggling to actually keep itand struggling with credit card
(35:19):
debt and and all of this andjust trying to get him like for
the longest time, like let'sjust open a brokerage account
and start an auto, pay $100 amonth, let's just start it Right
.
And just so reluctant to dothat, well, he emails me with
this private real estatesyndication that he's thinking
(35:41):
about investing in and it's like$100,000 minimum investment and
they've got these you knowillustrations of what they think
their returns are going to beand it looks pretty decent.
And I'm like, dude, you don'tneed this yet, you need the
basics first.
Where's the money going to come?
(36:01):
You won't give me, you know, athousand bucks to put in a
brokerage account.
Where are you going to come upwith a hundred thousand?
I mean?
Speaker 1 (36:09):
come on now, so yeah, basic work.
Speaker 2 (36:11):
Let's, let's, let's, prioritize those first.
Speaker 1 (36:14):
Well, thank you, Darren.
This has been a super funconversation and I know that
some folks may want to get aholdof you.
What would be the best way forthem to reach out and get your
attention?
Speaker 2 (36:25):
Absolutely.
It's super simple.
Our website islawyermillionairecom.
You can learn all about thebook, the podcast and, if you
want to chat with me, there's alink to my calendar there as
well.
Speaker 1 (36:35):
Very good.
Well, thank you for coming ontoday, grateful for that.
Speaker 2 (36:39):
Thanks, Jeff.
Is it harder to make your first million or to keep it
?
Speaker 2 (00:03):
For business owners it sometimes can be harder to
keep it.
Speaker 1 (00:06):
One of my first businesses was outside of law.
I was a lawyer, actually, and Istarted it and we ran that
business to $23 million, I think.
And I was just thinking, Ithought I was all that and we
did it because I'm justbrilliant and I'm super smart
and I'm the guy.
It was anything but that.
Speaker 2 (00:22):
It was like luck plays a role, whether we like it
or not.
Being in the right place at theright time, talking to the
right person, that could landyou a really high paying client
Right.
Speaker 1 (00:31):
So well, hello.
Welcome to the J SterlingHughes show, where we share how
we have built our family lawfirm from zero to 27 lawyers and
16 million in revenue in thepast 10 years, and my purpose
here is to document what'sworking and what's not working,
with hopes that you can takethat, recontextualize it and
have the family law firm of yourdreams.
(00:52):
My name is Jeff Hughes and I'myour host, and I have a guest
today.
I'm excited to have thisconversation.
I hope they'll learn a lot,darren, but my guest is Darren
Wurz.
He is the founder and leader ofthe Lawyer Millionaire.
He is the founder and leader ofthe Lawyer Millionaire Founders
Network.
He also wrote a book that waspublished by the ABA.
It's entitled the LawyerMillionaire the Complete Guide
(01:16):
for Attorneys on MaximizingWealth, minimizing Taxes and
Retiring with Confidence, and hehas a podcast, the Lawyer
Millionaire Podcast.
And, darren, I think you and Ifirst met on Facebook.
I had seen your not Facebook,definitely not Facebook.
Speaker 2 (01:29):
LinkedIn.
Speaker 1 (01:30):
And I'd seen your posts over quite a few months,
maybe a couple of years even,because I think we follow a lot
of the same people.
So that's how Darren and Iconnected.
And, darren, I got real quick.
I got to just tell the story,this hasn't happened before you
reached out and said, hey, I gotreal quick, I got to just tell
the story, this hasn't happenedbefore.
You reached out and said, hey,I think I have a lot to offer
for your guests.
And I didn't really see it likeobvious.
(01:51):
I'm really focused on familylawyers and I really want to add
value to family lawyers.
I said, no, I don't think it'sa great fit, or what can you
offer family lawyers?
And you shot back a realspecific value add list and I go
okay, that's something I couldbenefit from.
I know my audience can too.
So welcome, darren, I amexcited to have you.
Speaker 2 (02:15):
Yeah, I'm excited to be here, Jeff.
Speaker 1 (02:17):
Thanks so much for bringing me on.
I'm excited for ourconversation today.
Good, so, now you have a firmand just real quick, high level.
How did you get going in it?
What?
What led you to start a firmfocused on helping lawyers save
their money and retire well, soAbsolutely so.
Speaker 2 (02:34):
our firm, the Lawyer Millionaire Founders Network,
we're a financial planning firm.
We focus exclusively on workingwith law firm owners.
So those are you know are somefamily law firm owners, but a
variety as well.
How it began?
I kind of have a long history.
I started out as a verycommunity-based financial
(02:56):
advisor and I learned about theidea of niching and having a
really focused target market.
I just happened to have a lotof lawyer clients and so I
decided to focus on legal, butthen I learned legal is too
broad.
There are so many differenttypes of lawyers.
You know there's big law,there's owners, there's solo
(03:18):
attorneys, right.
So we decided to focus on lawfirm owners and it was really.
I saw it as a great opportunitybecause I saw a great need there
.
There weren't many financialplanners talking about law firm
owners.
You see a lot talking aboutbusiness owners in general,
retirees and things like thatbut I saw a great need there and
(03:41):
actually I started to have lawfirm owners coming to me asking
for help and what I noticed isthat they were making really
good money high six to sevenfigures in personal income but
they didn't have like they'remaking a million dollars a year
in income, maybe, but theydidn't have a million dollars
yet, right?
(04:02):
So that became my mission washow can we help these folks
really be intentional aboutbuilding wealth and it's cool
because it's a cross betweensome business planning and some
personal financial planning.
Speaker 1 (04:18):
Yeah, and that's where it gets really fun.
I'm real curious.
So these, these lawyers thatwould that you would run across,
that had like great income buttheir balance sheet sucked, like
they weren't able to reallyaccumulate.
If you can look back andsynthesize it down to one or two
things that you saw that theyconstantly did that was a
mistake, what would that be?
Because I'm all ears on thisone.
Speaker 2 (04:41):
It would be overspending at its core.
It would be overspending at itscore right.
But let's break it down alittle bit more.
First, in your business.
I mean, we all know it's easyto overspend personally, but
it's easy to overspend in yourbusiness.
We sign up for so many things.
You know, and I think law firmowners, business owners in
general we're focused on revenue, we're focused on growing
(05:02):
revenue, but I think oftentimesthat comes at the expense of
really being intentional aboutmaximizing profit in our
business, and so we really haveto be disciplined in how we're
managing cashflow and managingour business.
There's just a lot of there's alot of overspending.
It's easy to sign up.
Speaker 1 (05:20):
Were they overspending in their business
more in their personal life?
More which one was, was thebigger culprit?
Speaker 2 (05:25):
Both it's both.
Speaker 1 (05:27):
Yeah, I tend to be all overspend, aggressive, all
gas.
In the business side I'm morefrugal personally.
I just see everything as anopportunity.
So are you?
I mean like, okay, that's justa different mentality that leads
to the same path.
I mean, I've been at the highincome low balance sheet before
(05:48):
and I think that was my problem.
So how do you coach theselawyers through that and get
them to think differently about?
Speaker 2 (05:53):
that you know you're right, it's a mindset.
You know we can talk about thenumbers all day long.
I mean, at a basic sense, we dowant some awareness, because I
find so many law firm ownerscome to me and they're like you
know, I'm making all this money,but where is it going?
So let's find the leaks.
Let's find the leaks in thebucket, because there are leaks.
There are things you've signedup for that you're paying for,
(06:15):
that you're not using anymore.
You know there's money that'sgoing out the door.
So just having an awareness ofwhere the money's going is step
one.
Step two is really figuring outwhere you're happy.
The biggest trick in life,according to Morgan Housel,
author of the Psychology ofMoney, is to get the goalposts
(06:36):
to stop moving.
It's so easy.
I mean, as business owners, weare very aspirational, we're
very excited, we have big ideas,right.
We have big goals, big dreamssometimes, and that carries over
to our personal lives.
So sometimes we get a littlebit ahead of ourselves.
There's an interestingcorrelation between happiness
(06:58):
and money.
They're correlated to a point,but beyond a certain level of
income they diverge.
The happiness doesn't increaseproportionately with your income
, right, a certain level ofincome does increase happiness,
but beyond that it doesn't.
So figuring out at what level-.
Speaker 1 (07:18):
What's the number for that?
Is there a number like oncepeople get to 90,000 a year in
income?
It's the diminishing returnsets in.
Speaker 2 (07:27):
Yeah, I'm not.
I'm not sure and probably hasgone up you know inflation has
gone up right, I think it'ssomewhere.
At least last time I checked Ithink it was somewhere right
under a hundred thousand,something like that.
Yeah, so figuring out thatplace at which you are happy,
right, and you have a stablelife and you can, you can kind
(07:49):
of maintain that lifestyle andnot continue to expand it, and
then let's save the gravy on top, you know, let's invest that
and let's grow that.
Speaker 1 (07:57):
Yeah, so overspending .
And so when you take in aclient that you start to work
with what, what is your processor game plan to kind of get them
through?
How long does that typicallytakes?
I mean, I know the first thingyou're probably going to say is
just being aware of what you'respending your money on and then
(08:18):
and then firmly establishing thegoalposts.
I'm guessing that's what you'regoing to.
I'll let you say it.
So what would that be?
Speaker 2 (08:24):
Yeah.
So our process we try to getlike an initial plan put
together in the first threemonths of our engagement just to
kind of have the bare bones,and then we'll deep dive into
other areas.
The way I kind of see it,there's a three-step process.
I mean we want to hit certainthings right away.
You know, in the investingworld, earlier you start, the
(08:47):
better, right, because you havetime is your biggest factor in
terms of the growth of money.
But there's really like threesteps, you know.
And first we've got to get thebusiness stabilized.
We've got to get the businessgenerating the revenue that it
needs to generate and generatingthe profit that it needs to
generate.
Some people are not ready yetfor really focused financial
(09:08):
planning because they're justdrowning in their business.
Speaker 1 (09:11):
Yeah, can I double tap on that for a second?
I'm curious on what?
What are you running into now?
Let me see if I can ask thisquestion better.
When you say the first step isgetting the business stabilized,
that sounds like businesscoaching, going far beyond
estate planning.
And let's just bring it on thefamily lawyers where I live.
(09:32):
So if a family lawyer comes toyou, darren, and they're like,
hey, I really need some helpwith my finances, what are you
seeing a lot of times that youhave to help them stabilize, and
then what does that look like?
Speaker 2 (09:46):
Well, step one is separating the personal and
business finances.
I don't know if you see this insome of the family law owners
that you work with, butoftentimes when you start a
business, you start a law firm,you might not have all the
infrastructure in place and somaybe you have a lot of business
(10:07):
expenses still happening onyour personal accounts or
there's money flowing back andforth between personal and
business.
So that's that's really stepone, and I do get a lot of
pushback there sometimes becauseyou law firm owner will be like
, yeah, but my business amexgives me such great rewards or
(10:28):
my personal amex gives me suchgreat rewards, I want to put all
my business expenses on that.
It's like, well, the value ofhaving those things separated
and the clarity that that givesyou I guarantee you, guarantee
you it's more valuable than therewards that you might get.
Speaker 1 (10:46):
I totally agree, and I think family lawyers struggle
here because they see theirbusiness as an extension of
themselves and if they have thatline of sight, like that's a
business that's separate from mypersonal it gives them clarity
on where to focus some of theirefforts on their growth of their
business and I see the growthof both.
I think that's I didn't saythat great, but having that
(11:11):
clarity, being able to seewhat's my business, what's my
personal, I think is invaluable.
Speaker 2 (11:16):
You need to know what your numbers are.
Yeah, at the end of the yearyou need to know.
Okay, so step two.
I could give you all the steps.
I'll just give you a few StepNow.
Okay, so step two, I could giveyou all the steps.
I'll just give you a few.
Step two is pay yourself.
Pay yourself a normal, regular,automated salary.
So many owners are just takingmoney from the firm when they
(11:37):
need money and then they'reputting money back into the
business when the business isrunning low, right, and that
just becomes a nightmare and youcannot build wealth on that
instability.
You need to create stability inyour business.
Now, you know family law is,you know, like other types of
(11:58):
law.
Your income can fluctuate.
You know you can have dramaticchanges in your revenue and so
that can be difficult.
You've got to build reserves onthe business side.
You've got to build reserves onthe personal side, but getting
that owner's compensation downfrom the get-go that's another
aspect of clarity.
If you're not paying yourself amarket wage, you don't really
(12:21):
know if you're truly profitable,right?
So that's the other thing is,you know, really trying to build
in some stability in your cashflow, some regularity in
otherwise usually somewhatirregular cash flow.
Speaker 1 (12:36):
Yeah.
So after stabilizing the biz,what comes next?
Speaker 2 (12:42):
Step two is, yeah, is maximizing profitability.
And that's where we start tothink really carefully about tax
planning and really beingstrategic with our dollars in
our business and our personallife.
So really tracking the cashflow more effectively, setting
up cash flow systems that aregoing to help us, like the
(13:04):
Profit First system I'm sureyou're probably familiar with
that.
We love the Profit First system, you know just having a
framework and a structure foryour cash flow that's going to
allow you to really prioritizethat profitability.
And I call tax planning aprofitability exercise.
(13:25):
The purpose of tax planning ismaximizing profitability because
that's what it's doing it'sreducing your biggest expense,
which is your taxes.
Speaker 1 (13:33):
So when you talk about profitability, you're
talking about the amount ofmoney left over after you're
paying yourself right.
So call that a distribution ormaybe a dividend I guess one of
those two and the idea would beto maximize the amount of money
the law firm is spinning off andyou'll do tax planning to help
(13:54):
with that.
Do you get beyond that, likeinto the actual business and how
the money's being handledwithin the business and expenses
are flowing through?
How deep do you go there?
Speaker 2 (14:05):
Well, we can go as deep as clients want us to go.
Oftentimes our clients willhave other partners that they're
working with, like a bookkeeperor maybe even, if you're at the
level you need it, a virtualCFO.
We're big fans of that.
I mean, we don't reallynecessarily want to do that work
specifically.
So, you know, at a certainpoint we will recommend bringing
(14:27):
on um, a virtual cfo or, youknow, fractional cfo or maybe
even a full-time.
You know, if you need it, um,because they will help you
really be intensely strategicwith how you're using the money.
You know, when you get to acertain revenue level, you're
the 10 million revenue level.
(14:47):
You can't play games anymore.
I mean, you need to be able tovery accurately and precisely
predict cash flow.
You have a whole team that'sdepending on you for payroll
right, so you've got to be ableto know where you're headed and
make decisions based on that.
Speaker 1 (15:07):
Yeah, I can tell you that we went through all those
iterations.
We didn't have any of that.
We got a fractional CFO, likearound 12 million, and that
didn't really help us a wholelot.
We had a big top line, nothingon the bottom line, and it
wasn't until we got a full-timein-house CFO at at uh, at, I
(15:32):
think, 15 million, and we took ahalf million or we dropped back
like a half a million bucks butthen our bottom line tripled,
having that disciplined eye onour finances, so huge believer
in what you said about that.
That counters my recklessnesssometimes where I'm all gas and
(15:53):
not really paying attention towhat I need to.
So, ok, so second step in yourprocess is helping the lawyer
maximize the profitability oftheir firm.
What comes after that?
Well, hello, jeff, here my teamand I put out a weekly
newsletter designed for familylaw practitioners to help you
grow and build your practice.
So if you go to my website atjsterlinghughescom that's
(16:17):
H-U-G-H-E-S, that'sjsterlinghughescom and subscribe
, it would mean the world to meand what I will do for you there
is.
I will send you weekly contentto help you build and grow your
practice, as well as news anddevelopments in the greater
world of family law.
Thank you, and back to the show.
Speaker 2 (16:34):
Yeah, the third step is growing the wealth, and
that's really the final step inthe three-part series.
Honestly, we want to startgrowing the wealth earlier, but
you know, once we to startgrowing the wealth earlier, but
once we've gotten the businessin a good place, we've got
really good profitability, thenwe're in a really good place to
really pour some gasoline onbuilding the wealth right and
(16:56):
making sure we have a reallygood investment strategy, making
sure we're making really smartinvestment decisions and I'm not
just talking about stocks andbonds right, maybe at this point
it's time to invest in otherbusinesses.
Maybe it's time to look atprivate equity.
Maybe it's time to look at realestate and diversify our income
streams different things likethat.
(17:18):
So it's about trying to getyourself in a place where you
are work optional and that'swhere we want to get to.
Speaker 1 (17:29):
So what's work.
Optional mean you don't have towork, you have the option.
Is that what that means?
Speaker 2 (17:33):
That's correct.
Speaker 1 (17:34):
That's correct.
Speaker 2 (17:35):
Yep, you know it's.
Retirement is not reallysomething that I find a lot of
law firm owners are reallythinking about.
I mean, they're familiar withthe word and they know they need
to do retirement planning, butthey're not thinking I want to
retire at age 65.
You know what I mean.
You find that the case.
Speaker 1 (17:55):
Yeah, I see that all the time with people in my world
where they hang on a little bitjust because they like the
income.
They don't really know when tostop and so it's challenging.
Speaker 2 (18:07):
Right.
So we want to get your moneyworking for you in a place where
and get you to a place whereyou no longer need the income
from the business.
That's where I really want toget to.
You've got the assets built up,assets built up, you've got
(18:28):
things compounding and providinginterest and dividend income in
the background, so that you'rein a place where you could step
away if you want to, and thatreally puts you in a great frame
of mind.
Speaker 1 (18:35):
How do you go about relative to family lawyers,
darren?
Because in our world most ofour firms are small.
Frankly, a couple lawyers thatreally on average at most.
That's pretty normal and that'skind of tough to get to the
point where you work optionalwhen it's maybe you and a
partner or you and an associate,like how do you help them work
(18:59):
through that and get to thatlevel?
Speaker 2 (19:01):
Well, it's a combination of thinking about
your business and your financesright, because you're right In
family law.
You've got so many things goingon.
You've got mediations, you'vegot court appearances and your
clients are going through a timeof crisis, right, and so they
need you, and oftentimes theydon't.
(19:22):
They don't necessarily havelegal questions, they just want
somebody to talk to, and thenyou've got it's a very
contentious, oftentimes type oflaw that you're dealing with.
So the emotions are high, thestress is high, plans get
changed all the time.
Speaker 1 (19:47):
So talking about their retirement plan, their
dates and things like that?
Speaker 2 (19:50):
get changed a lot.
You see, oh no, I'm talkingabout like, like work, you know,
like you know things like that.
So you've got to have help.
I think you really have to havehelp in your business If you're
going to get to that placewhere you could step away.
I mean, you might have thefinancial resources, you might
get to a place where you havethe financial resources to get
there, but you really have toalso build it into your business
(20:13):
.
So at some point you're goingto need to hire an attorney or
an associate who can start doingthose court appearances for you
.
You we just had a family lawfirm owner on the podcast who
has a very large family lawpractice and she had to cancel
our meeting because she gotpulled into a mediation at the
(20:35):
last minute.
You know what I mean.
So that kind of stuff canhappen in family law and you got
to structure your business in away where you can get out of
that that need for you to beinvolved.
Speaker 1 (20:50):
So you were talking I'm curious on the building the
wealth part.
So your your third step andthat's obviously the longest,
because once you get there itjust becomes something.
You stay with the lawyer foryears and help them build their
wealth.
But you mentioned a whole lotof different types of
investments, and Is there oneclass that you focus on more,
(21:11):
that you're more of an expert inthan others, or can you kind of
unpack?
Speaker 2 (21:17):
that.
So probably our highestexpertise is in your traditional
portfolio of stocks and bonds,right, yeah, and I find there's
a lot of myths around investing,even in this day.
I mean, I've been around formany years in this business.
(21:37):
In fact, my dad was a financialadvisor and his dad before him,
so we have a long history inthis business.
And years and years and yearsago, you would typically invest
through a broker.
You would buy stocks and youwould pay commissions to buy
these stocks, or you would buymutual funds and they had these
(21:58):
5% upfront charges.
Well, we've seen costs come downso dramatically in the
financial industry and it'sfantastic for consumers, for
consumers.
So my golden advice is passive,indexed investing is really the
best way to go.
Are there funds that sometimesbeat the market from time to
(22:26):
time?
Yes, there are, but the thingis consistency, right.
Is that going to happenconsistently?
So here's the thing I canafford to not be the world's
best investor, but I can'tafford to be a bad one.
That's the thing, right.
So I need a really good, solidindex portfolio that's going to
(22:48):
deliver strong returns over thenext 20, 30 years.
I can dabble, you know, with asmall amount of the money, but
we need to make sure we've got areally solid investment plan in
place.
I find that sometimes, whenyou're at a certain income level
, you start to think that youneed certain exotic strategies,
(23:11):
you know, and those can beappealing, but don't miss the
basics.
You really need to have a goodfoundation of the basics.
Speaker 1 (23:17):
Yeah, it seems to me and I'm not a, certainly not an
investor but the world's bestinvestor one year is a crappy
investor, the next year and it'sthe.
It's that consistent justblocking and tackling over many,
many years that makes thedifference.
Speaker 2 (23:31):
right, that is a hundred percent true, and you
know we've we've tried differenttactical strategies.
So a tactical strategy is onewhere you're going to, you know,
shift your allocation.
Maybe you're going to go intostocks, you know, because stocks
are looking good, theindicators are good, and then
you're going to get out ofstocks when the indicators are
(23:53):
not good, because you want toavoid a market decline.
And you see these right?
You see these newsletters.
These people have thesenewsletters and they put out
about how their strategy right,if you would have followed this
strategy for the last 15 years,you would have beat the market
by 400% and you would haveavoided the 2008 crash.
But the golden question youhave to ask is how long has real
(24:20):
money been in this strategy?
That's the only thing thatmatters.
And when you look at that andyou're like, oh, you've only
actually been using this for thelast year, well, what were you
doing before that?
Speaker 1 (24:33):
Okay.
So they're coming up with somestrategy and then looking back
in history and say, well, if I'dhad this strategy 15 years ago,
I'd be a trillionaire today.
Speaker 2 (24:43):
Yeah, it's a fallacy called overfitting, because
anyone can look at history andcreate a strategy that would
have done fantastically well.
Well, whoop-de-woo, we don'tknow how it's going to do.
Going forward, it might suck.
Going forward, yeah.
Speaker 1 (24:59):
One of the things we talked about a little bit before
the call and then on your emailwas helping family lawyers
scale their firm and build it.
I love that topic.
A lot of what I do is aroundthat, so how do you support
family lawyers in doing that?
Speaker 2 (25:14):
So you know we will help our clients think
strategically about steps theyneed to take um in that hiring
process.
Um, some of the biggest things Isee, um, I see a reluctance to
hire people virtually.
Um, and certainly you knowthere's there is aance to hire
(25:35):
people virtually, and certainlyyou know there's there is a
value to having people in person.
But if you are able to expandyour thinking a little bit like
I have one family law client,I've been trying to get him to
hire an executive assistant foryears and he won't do it.
And I'm like, I'm like, if youcan just do this one thing a
virtual executive assistant whocould offload some things for
(25:59):
you, like checking your emails,maybe doing some social media
for you, maybe creating anewsletter for you and having
that eat these are the basics,right, you know.
So, thinking through who weneed to strategically hire and
when, maybe it makes sense tobring on an actual attorney and
really start expanding andgrowing things in terms of
(26:23):
billable work, yeah, so that'sthat's kind of where we help
Thinking about how you'regrowing the team.
I'm sure that you're probablymuch more of an expert in that
area than I am.
Speaker 1 (26:37):
Well, that's a great service, though, because I do
see that with family lawyers weget kind of reluctant to want to
make the investment.
But it requires that if we'regoing to continue to grow and
offload some of that work.
Speaker 2 (26:49):
But you don't have to be scared.
It doesn't have to be a hugeinvestment.
You can bring people onpart-time, you can bring people
on as a 1099 and then transitionthem to W2 when you're ready
for that.
So it's not and you want tothink about where your time is
best spent?
Right?
If you're doing you know, ifyou're doing $15 an hour work,
you're not optimizing your time.
(27:12):
Now I will tell you right, whenyou're building the team, let's
think strategically about yourclients and what they need,
right?
So many attorneys think.
So many law firm owners, smalllaw firm owners think that their
first hire should be anattorney.
Yeah, maybe, maybe not right?
I can see where they'll bedoing billable work and that'll
(27:34):
be great.
But at the same time, attorneysare expensive.
Let's be, real.
So think about some othersupport staff.
One of the most innovativethings I've heard is bringing on
a life coach or a divorce coachto work with your clients,
someone who they can just talkto and unload to and who can
(27:58):
help them navigate some of theemotions of that process.
I think that's a fantastic ideaand that would free up some of
your time to be able to do a lotmore of the actual legal work
and be a great service, a greatvalue add potentially to your
clients.
Speaker 1 (28:16):
Yeah, the Merrill Law Firm in Chicago has recently
done that and, according to thepost, it's going well, and we've
kind of talked about that.
I can see that being a workablething.
We haven't pulled the triggeron it yet, though.
One thing I was thinking abouttoo in preparation for our
conversation, darren, was infamily law.
(28:37):
I mean, we see, unfortunately,people really go through a
really hard time, and part ofthat is they make a lot of poor
financial decisions, especiallyas they're coming out of their
divorce, and they want to kindof get back to the same
lifestyle they had before, orthey want to keep the house when
they shouldn't keep the house,and so we we have a front row
seat in a lot of these kind ofshoot yourself in the foot
(28:58):
financial moves.
Have you seen family lawyerstreat their work with you
differently on average rightVersus other lawyers?
Because of the insights we havewatching some of our clients,
I'm just curious if there's ahigher education level in the
world, in the real world of hardknocks from the family lawyers
(29:19):
coming to you.
Speaker 2 (29:21):
I don't know, I don't know about that All right.
Speaker 1 (29:24):
So that's just my fantasy.
Thought that maybe that wouldbe the case, okay.
Speaker 2 (29:29):
In my experience, it might be the opposite.
Speaker 1 (29:31):
Oh, okay, tell me about that.
Why?
Why do you think that?
Speaker 2 (29:35):
I think maybe it has to do with the level of if
you're doing all the client workand you're deeply involved in
the process.
I think it may have to do withjust the, the emotions and the
stress of of the work.
Um, I I find that maybe that,maybe that has an effect on how
(29:56):
you manage your finances.
Maybe it causes you to be alittle less disciplined in your
investments or your, yourfinances, because that stress
just carries over.
You know, like we need to blowsome money because you know
we're, we're stressed out.
Um, I have, I have one familylaw client who I, I, what I see,
(30:20):
jeff, that really um, that Ifind troubling is clients who
who just kind of been stuck inthe same place for so many years
, and those are the ones Ireally want to liberate.
I find yeah, I find that a lotwith family law too, because it
(30:43):
is kind of a stressful type oflaw.
So a lot of folks are kind ofreluctant to grow necessarily.
A lot of folks are kind ofreluctant to grow necessarily.
So you've got to really beintentional about how you're
managing your stress load andtake progress right.
I mean, we all do these, youknow 10-year vision, five-year
(31:06):
goals, whatever, and that'sgreat, but I like to put a
number on it, like how old willyou actually be in five years?
Okay, now let's think where doyou want to be then versus now
and let's get there right.
Let's get out of being stuck inthe same place for so long.
Speaker 1 (31:22):
Yeah, is it harder to make your first million or to
keep it?
Speaker 2 (31:30):
Well, it is certainly hard to make the first billion.
Speaker 1 (31:32):
Yeah, it's hard, I get that, but I'm talking
relative to each other.
Yeah, it's harder to make it orkeep it.
Speaker 2 (31:42):
For business owners, it sometimes can be harder to
keep it, and the reason is theskill it takes to create money
in the first place is notnecessarily the skill it takes
to keep it.
And the reason is the skill ittakes to create money in the
first place is not necessarilythe skill it takes to keep the
money after you've made it,because the skill to keep it is
all about discipline and cautionand being a little bit more
(32:07):
conservative, whereas the skillto grow it, you know, is risk,
you know opportunity, you knowthings like that, you know.
So, yeah, here's a great story,right?
Have you ever heard of thestock trader Jesse Livermore?
Speaker 1 (32:21):
No, he's got a cool name.
Speaker 2 (32:23):
Yeah, so he was a stock trader during in the 1920s
and he was I think he was theonly stock trader who shorted
the market on Black Friday whenthe market crashed.
Okay, so, overnight he becamethe wealthiest man in the United
States and then, but theproblem was, after that he
(32:47):
thought he was invincible,invincible, and so, you know, he
died basically penniless.
He made all this money.
He made all this money taking arisk, taking a bet, you know,
taking advantage of anopportunity.
But then he didn't change hisperspective and think, okay, now
(33:08):
it's time to protect what Ihave and make sure that I keep
it.
The same thing happens in ourbusinesses, right?
Sometimes we're so focused onpouring fuel on the fire and
growing, and that's great, butat a certain point we have to
change our perspective a littlebit and start to really think
about maximizing profitability.
Now it's time to really makesure we're keeping a lot of this
(33:30):
money that we're making.
Speaker 1 (33:31):
Yeah, I can identify with that.
I one of my first businesseswas outside of law.
I was a lawyer actually when Istarted it and we ran that
business to 23 million I think.
And you know, I was justthinking, I thought I was all
that and we did it because I'mjust brilliant and I'm super
smart and I'm the guy.
It was anything but that.
(33:53):
It was like I took a risk.
It happened to land on red whenI bet red and it was so hard to
hang on to that and you know,eventually eventually rolled the
business right back down to acouple million before I sold it,
so did not maximize what I hadbeen.
I just didn't have thediscipline, like you said.
Well, and.
Speaker 2 (34:13):
I think we often we forget to acknowledge the role
that risk, does risk and luckplay in building a business.
Yeah, luck plays or plays arole, whether we like it or not.
Being in the right place at theright time, talking to the
right person, you know that youcould land you a really high
(34:34):
paying client right.
So there is a bit of luck andwe've got to let that give us
some humility in how we approachour business.
Speaker 1 (34:42):
For sure.
Last question I'm just curiouswhat's the wildest?
Is there a story that sticksout to you where a lawyer came
to you and wanted to allocatesome of their resources to some
wild harebrained scheme?
Have you ever had any of that?
Speaker 2 (34:58):
Let's see Wild harebrained schemes.
I have seen some right.
So I have one client that doescivil litigation defense and
he's in the same boat, you know,making a lot of money but
struggling to actually keep itand struggling with credit card
(35:19):
debt and and all of this andjust trying to get him like for
the longest time, like let'sjust open a brokerage account
and start an auto, pay $100 amonth, let's just start it Right
.
And just so reluctant to dothat, well, he emails me with
this private real estatesyndication that he's thinking
(35:41):
about investing in and it's like$100,000 minimum investment and
they've got these you knowillustrations of what they think
their returns are going to beand it looks pretty decent.
And I'm like, dude, you don'tneed this yet, you need the
basics first.
Where's the money going to come?
(36:01):
You won't give me, you know, athousand bucks to put in a
brokerage account.
Where are you going to come upwith a hundred thousand?
I mean?
Speaker 1 (36:09):
come on now, so yeah, basic work.
Speaker 2 (36:11):
Let's, let's, let's, prioritize those first.
Speaker 1 (36:14):
Well, thank you, Darren.
This has been a super funconversation and I know that
some folks may want to get aholdof you.
What would be the best way forthem to reach out and get your
attention?
Speaker 2 (36:25):
Absolutely.
It's super simple.
Our website islawyermillionairecom.
You can learn all about thebook, the podcast and, if you
want to chat with me, there's alink to my calendar there as
well.
Speaker 1 (36:35):
Very good.
Well, thank you for coming ontoday, grateful for that.
Speaker 2 (36:39):
Thanks, Jeff.
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