Why Family Law Firms Struggle with Cash Flow (And How to Fix it) (Ep. 155)

Written By Adedayo Adekunle

Profitability is a constant focus for ambitious law firm owners, but for many, consistent cash flow seems like a moving target. On this episode of The Lawyer Millionaire Podcast, Darren Wurz is joined by Chicago-based family law attorney Russell Knight as he shares proven strategies for eliminating cash flow headaches and building a firm that runs on purpose and profit. If you’re a law firm owner who wants better financial systems, sustainable growth, and a happier team, you’ll find actionable takeaways in this conversation.

The Cash Flow Mistake Most Law Firms Make

For many family law attorneys, compassion can lead to cash flow disaster. Russell Knight points out that being “nice” by giving clients grace on overdue invoices doesn’t just hurt the bottom line, it creates unhealthy expectations. He explains, “the grocery store doesn't care if you’re hungry and you shouldn’t care if you’re making promises to pay in the future.” In a law firm, every service deserves timely payment, regardless of what clients are going through.

Takeaway:
Have a clear, consistent payment policy. When you expect timely payment, your clients will too.

Simple Changes That Boost Collections

Knight shared how he used to send monthly invoices and hoped for the best, only to get caught in uncomfortable conversations and unpaid bills. The turning point came when he outsourced billing follow-up to a virtual assistant. Instead of clients getting automated messages, they heard from a real person (even if that person was remote). The result? His collections rate jumped from about 80% to the mid-90% range.

Action Steps:

  • Assign billing and collections to a dedicated team member even if you have to hire a part-time or virtual assistant.

  • Personalize billing communication. Even a simple, “Hello, here is your bill let me know if you have questions,” builds accountability and increases your chances of being paid.

  • Set clear deadlines (e.g., 14 days to pay, 7 days for billing questions), and enforce them.

Consistency Matters: Retainers, Expectations, and Boundaries

One costly mistake? Offering different retainer arrangements or discounts based on emotion. Knight recommends a universal approach: “Do the same retainer for everybody and say, ‘You just have to trust me. Maybe I'll give some of it back if your case is easy.’” This avoids confusion and attracts clients who value your expertise, not just your price.

Set expectations up front about retainers, billing cycles, and consequences for non-payment. Consistency creates trust and smooths out cash flow.

Rethink Profit: Focus on the Business, Not Just the Practice

For Knight, business planning is just as important as courtroom skill. Instead of splurging on expensive offices or massive ad budgets, he built authority through content marketing and a lean remote team. This allowed him to:

  • Minimize fixed expenses by limiting unnecessary overhead.

  • Invest profits back into team retention and client experience (e.g., staff retreats, bonuses).

  • Avoid the trap of top-line revenue obsession—prioritizing profit and retained earnings instead.

Pro Tip:
Track monthly gross revenue and ask, “What’s working?” A spike (or a slump) is an opportunity to review processes and address any leaky buckets draining your financial performance.

Grow with the Right Team and Metrics

Hiring doesn’t have to drain your profit if you’re strategic. Knight recommends scaling to at least two attorneys and two paralegals before stepping fully into a business owner role. Assign someone to supervise support staff, automate systems where possible, and ensure everyone is compensated fairly for creating value.

What metrics should law firm owners watch? Knight suggests:

  • Monthly gross revenue (spot trends and gaps).

  • Hours billed by each team member.

  • Collection percentage (what you bill vs. what you receive).

Track these regularly, schedule review meetings, and address “leaky buckets” before they become major issues.

How to Incentivize Your Team Without Taking Big Risks

Your job as a business owner is to absorb risk so your employees don’t have to. Knight creates individual compensation plans based on his team’s needs such as bonuses for billed hours, salary raises, or even personal advances when life happens. The result is a loyal, motivated team focused on results.

The Three Keys to Law Firm Growth

Knight boils success down to three areas:

  1. Marketing: Get on clients’ radar any way you can. Start small if you need to, just don’t sit back and hope for referrals.

  2. Sales: Invest in sales training to turn callers into paying clients. This skill pays for itself quickly.

  3. Collections: Make payment a system, not a suggestion.

Nail these and you’ll generate the revenue needed to hire, give bonuses, and reinvest in your firm’s future.

Conclusion

Cash flow isn’t just a financial metric, it’s the heartbeat of a thriving law firm. The firms with the healthiest margins are those with disciplined systems, clear expectations, and a laser focus on people (both staff and clients).

If you’re ready to move beyond uncertainty and build a profitable, purpose-driven law practice, start by systematizing your billing, investing in your best team, and watching the metrics that really matter.

Resources:

 

Connect with Darren Wurz:

 

Connect with Russell Knight:

 

About Russell Knight:

Russell Knight is a dedicated divorce and family law attorney focused exclusively on resolving complex legal matters in Illinois. With an extensive portfolio of over 700 published articles on Illinois family law, he is widely regarded as a thought leader in the field of family law. His commitment to clarity and client advocacy sets him apart.

After earning his Juris Doctorate from the University of Illinois College of Law in 2006, Russell began his legal career with a focus on family law. He also holds a Bachelor of Science in Business Computer Systems from Bradley University, which he received in 2000. He is licensed to practice in both Illinois and Florida.

Russell’s litigation skills are finely honed through advanced training from NITA’s deposition course, the National Family Law Trial Institute’s Kolodny Trial Skills Course, and an advanced cross-examination program. He is also a faculty member of the Illinois Institute of Continuing Legal Education and the author of Chapter 3, “Obtaining Orders of Protection,” in the 2024 IICLE Family Law guide.

Throughout his career, Russell has helped countless clients navigate the emotional and legal complexities of divorce, child custody, and protective orders. His work has been cited by media outlets such as NBC News, Parents’ Magazine, and Newsweek. His ability to communicate complex legal principles in straightforward terms empowers clients to make informed decisions.

Known for his sharp strategy and strong courtroom presence, Russell Knight brings structure and predictability to the often-chaotic realm of family law. His fluency in English, French, and Spanish allows him to serve a diverse clientele with compassion and clarity. If you’re facing a divorce or family law issue, Russell offers experienced and personalized representation focused on achieving results.

Transcript:

Darren Wurz [00:00:00]:

All right. And we're here with Russell Knight in Chicago, Chicago-based attorney and law firm owner who focuses on family law. Welcome to the show, Russell.

Russell Knight [00:00:10]:

Thanks for having me, Darren. Always nice to talk to somebody and get some new perspectives on things.

Darren Wurz [00:00:15]:

Yeah, absolutely. And, you know, in the— before we hit the record button, we were talking about how it's a huge mistake. There's a huge mistake that family law firms face. Tell us what that is.

Russell Knight [00:00:30]:

Family law attorneys are generally nice people who know they're walking someone through one of the worst chapters of their life. So they give them a lot of grace. And that means sometimes they don't insist on getting paid for their services when an invoice goes out and the invoice is due. They're like, you know what? They'll probably be due good for it. They know I'm doing good work. They have a house they're probably going to sell. Well, everybody's bills are due at the point of sale. The grocery store doesn't care if you're hungry and they shouldn't care if you're making promises to pay in the future because everybody else, we got families, we got bills to pay too.

Russell Knight [00:01:11]:

This is just the way the economy works. There's not an exception for people going through a divorce. You got to pay 100%.

Darren Wurz [00:01:17]:

I love that perspective. And we're going to get into that. For you, the listener, today we're talking about cash flow problems and solutions in family law firms. You know, it's part of our theme this year, which is Profit on Purpose. And this quarter, we're talking about profit systems and cash flow systems as we're reading the book Profit First. So, we'll get into all of that. Russell, tell us a little bit about your firm. Where you are today, just so that our listeners get to know a little bit about you.

Russell Knight [00:01:52]:

I'm in the suburbs of Chicago, Illinois today. I have a firm in Chicago and a firm in Naples, Florida. And we've got 6 attorneys plus me and 6 support staff. And we all get along a lot real well. And we walk people through some really terrible chapters of their life and onto a better chapter as divorce attorneys or family law attorneys. Or whatever deals with the domestic relations, domestic violence, something domestic, I solve the problem.

Darren Wurz [00:02:22]:

Absolutely. Great, great. Okay, so you got to get paid, right? That's number one. Was there ever a point in your life where this was an issue for you and you kind of realized, hmm, we've got to make some changes here?

Russell Knight [00:02:35]:

Yeah, the family law attorneys, we send out bills at the end of the month or sporadically throughout the month. And then we hope those bills get paid. So there's a lot of us just send it out and then maybe the next time we touch it and we're like file, we're like, well, they paid us or they didn't pay us. Then you have to have an uncomfortable conversation. Well, it's not productive to anybody. You should send out bills on a particular schedule and people should know that they're expected to pay them at a particular time, not instantly. I give people 14 days and then They also have a 7-day period to question any of the billing and bring that up to, do they want to debate what the billing was? And then they got to get paid or work stops. And the fact of the matter is, is that if you're a lawyer, you are not going to block off the appropriate time of your day to send out these bills and then to follow up with the bills 14 days, 7 days later, 30 days later, 6 months later.

Russell Knight [00:03:32]:

You're just going to do the work because you're like, My life's on fire. I got to get this motion out. I got to prepare for this hearing. I got to try to get this new client. So you will not give the bills the attention they require. And so what happened to me is that I ended up hiring a virtual assistant to take care of it. My software, they have a little button where you press it and it sends out automatically all the bills to all the clients. Well, clients are not stupid.

Russell Knight [00:04:01]:

They can tell that it's automatic because it's coming from.com or what have you. But when you have someone individually saying, "Hi Brian, this is Gregory with Russell's office. Here's your bill. You have 14 days to pay. There's a link right here. If you have any questions, please let me know." People are like, "Oh, it's real. I was looking at this." Even then. Yeah.

Russell Knight [00:04:25]:

People are so much more inclined to pay. I don't know. Wow. I was probably getting paid like 80% of my bills, maybe probably less than that. And then it immediately shot up into the mid-90s once I had a real person sending out bills.

Darren Wurz [00:04:37]:

Wow.

Russell Knight [00:04:38]:

It's really all it took and it cost nothing. The people outside of the United States who do these virtual jobs, they speak better English than you or I. I have one assistant that's from the Philippines and I asked her like, well, when did you live in America? She said, I never have. I'm like, well, why don't you have an accent? And she watched a lot of movies, I guess.

Darren Wurz [00:04:57]:

Yeah.

Russell Knight [00:04:57]:

I had an— my billing assistant is— he worked for KPMG in Argentina. Wow. It's just the nature of currency exchanges that the almighty dollar can buy you a lot of really good labor. And because these people are sending out bills, they're not looking at private information, you don't need to have an American work on that stuff. It can just get done. Yeah. So that would be the first hire for any divorce lawyer. I would say you do the work, your next person is your billing person because I have a whole system.

Russell Knight [00:05:26]:

It's marketing, sales, collections, and then the work.

Darren Wurz [00:05:31]:

Yeah. And that can make such a huge impact on your bottom line. I mean, you may not realize it at the time, but a 10% increase in actually collecting on invoices which is what you said you experienced, I mean, let's say you're billing $500,000 a year, that's an extra $50K. I mean, come on now, right?

Russell Knight [00:05:53]:

So it's not even like that you're making 10% more, you're probably making 20% more because your costs are fixed. Professional services usually, you know, 50 cents on the dollar is the expenses. So the question is how do you get more dollars? Your expenses aren't really tied to your, the income coming in. Your expenses are tied to the work that's coming in. So yeah, make sure that once you've got the phone ringing and people signing up, your next step is to make sure they pay. And you got to have somebody watch that and be on top of it. And everybody I know that's really successful at this, they have both. They have somebody who's devoted almost exclusively to collections.

Darren Wurz [00:06:32]:

So, so take notes, listener. You need, you need to have somebody who is devoted to this 24/7 and it's it's not just always about the time I find for law firm owners, but sometimes there's a little bit of an emotional aspect too. It's hard sometimes for us to ask people to get paid, ask people to pay us. But when it's your job, it's kind of, you're kind of dispassionate with it. You can do, you know, the people whose job it is to do this, they don't have the emotional attachment that we do.

Russell Knight [00:07:03]:

Yeah, I would totally agree with that. When I'm working the case, because I like my client, I don't want to be like, hey, so, You know how I'm getting you through this horrible thing and like some things are working and some things aren't? Well, now I think you're a deadbeat, so pay me. I don't want to say that. So I'd rather have someone else say, you know, pursuant to our policies, I need a payment or discussions about a payment plan within 14 days. But because I have 6 attorneys that work with me, I often come in as the heavy and I will say like, you know, we had an initial conversation, but I'm like, hey, you haven't paid. I'm sorry, we gotta get out of the case. And I can effectively.

Darren Wurz [00:07:39]:

At what point do you make that determination that we are gonna stop working?

Russell Knight [00:07:44]:

After 14 days and I haven't been paid. And if you, I can tell when you're ignoring me. There are many people who are like, freeze, I have to get this done. You know my money's tied up. I'm gonna make regular payments of what I can do. And most people like, you can, if someone says to you that they're gonna make a payment, on a regular basis and they do it 3 times, you can bet that 99% chance that that payment will recur and then you can act accordingly. But if someone kind of blows you off the first time, like, that's not going to be the last time.

Darren Wurz [00:08:16]:

Yeah. Yeah. You can see that they're opening the email and looking at it, but not taking any action. Yeah. Like, okay, come on now. Let's see. So have you Have you experimented with the timing of bills too at all? Like, you know, when you're sending them out, like, you know, sending them out maybe more frequently? If you've done anything with that?

Russell Knight [00:08:42]:

I don't do that. I know that some people send it out every 2 weeks to match when people's paychecks go out. I don't, I've not found that that's—

Darren Wurz [00:08:50]:

Doesn't move the needle. Okay.

Russell Knight [00:08:51]:

I don't know if the juice is worth the squeeze. Like I said, like if I went from like getting paid for 70% something of my bills bills to 95% just by having a person send it out. Like, how much difference is there with 5%?

Darren Wurz [00:09:04]:

Right, right. You're already doing pretty good there. So how do you set expectations at the beginning of a client engagement? Is there a retainer that they pay? What does that look like at the start?

Russell Knight [00:09:20]:

One, do not change different retainers between different people. They, if your price shot, if you're trying to compete on price, you're, you're doing something wrong. And the retainer is not a way to compete on price. People will tell you what they can afford. You should do the same retainer for everybody and say like, just have to trust me. Maybe I'll give you some of it back. Maybe your case is that easy. And if their case is truly that easy, they'll find somebody who like does things for a lot less.

Russell Knight [00:09:49]:

And you didn't need that work anyways because it was not The good cases are cases that go on and on and on, not because you want it to go on, but just because like you can provide that much more value because they have bigger challenges. So you don't want the little cases, just provide the same retainer, send out the same bill every month. And that way the client knows what to expect and is also able to consume the responsibilities at a regular pace. Like a heavily litigated case, it's where everyone's hair isn't on fire. I mean, if it's like between $5,000 a month, you know, a lot of, a lot of people can swing that or it doesn't last forever. It lasts for like a 6-month period where you got to put stuff on different credit cards. People can figure it out. And also like it's usually marital expenses.

Russell Knight [00:10:34]:

And by that time in the 6 months, I can have the other side pay for it or we're starting to liquidate assets to get paid. Consistency is key is my point.

Darren Wurz [00:10:44]:

Right, right. So let's go back to the same retainer for everybody. Never offer a discount, right? Is that your philosophy? Do you— what do you do when somebody is kind of balking at your fees?

Russell Knight [00:10:59]:

I tell them that, like, they're welcome to hire somebody else. It doesn't— my phone rings multiple times a day. I don't need—

Darren Wurz [00:11:09]:

yep, yep. And when you have, you know, when you— there's a certain psychological component to that. You know, people are more likely probably to hire you when you're firm on your fees, because you have that confidence. And they're probably asking, well, he must be worth it, right? Is that going through their heads, you think?

Russell Knight [00:11:30]:

I don't know. And I don't care. I just want them to pay me.

Darren Wurz [00:11:33]:

As long as you're getting paid. Absolutely. Okay. So what other issues have you found in cash flow in running a family law firm that have cropped up for you?

Russell Knight [00:11:46]:

I own the firm, so the money comes to me because it's just me that is the primary person. I have partners in decision-making, but not in equity. I have the money in an account and I don't need to divide it up amongst other people. People get paid, they get bonuses, et cetera, but these retained earnings are exclusively under my purview. This lets my staff and vendors, everyone can be assured that there will always be money available to pay them because I'm not distributing earnings amongst other people. So at least in small law, like family law, it's, I think, to the advantage of anybody who does business with me to know that I pay my bills, not just because I choose to pay my bills, because I can pay my bills. I have the retained earnings and I cash out once a quarter. That's it.

Darren Wurz [00:12:39]:

So, you've developed a lot of cash flow discipline, which is what the Profit First system is really all about. I mean, whether you're familiar with it, I mean, whether you use it religiously or use some form of it, it's exactly that way, right? Keeping money in the business in specific accounts for specific purposes. One of the biggest misconceptions I see among business owners in general is a misunderstanding of or too much of a focus on top-line revenue and not enough focus on actual profitability. And I have seen firms that try to grow. They put tons of money into marketing and, you know, they're spending $40,000 a month on Google Ads or what have you. And they're actually— they grow in terms of revenue. They actually shrink in terms of profitability or they're operating at a net loss. Was that ever— was there ever a moment where you kind of thought, "Hey, I've got to think more about profitability than revenue"?

Russell Knight [00:13:46]:

Well, I'm a different animal. I zig when everybody else zags. I built my business by doing a lot of stuff that people are not willing to do. Chicago business has 750 long law review style articles with all the citations so you can cut and paste them specifically so I can cut and paste them when I need them, use them later. And they're all posted. And I've been doing that since 2016. It's longer. The articles all put together are longer than the Bible.

Russell Knight [00:14:16]:

Everything in there. We have a chatbot that lets you search the articles with AI and it does a very good job of answering questions. So I did that because one, it was free. It's just my time. I do it every Saturday morning. I read every appeals decision and I put those snippets from that are relevant into my existing articles. And once in a blue moon, I think of a new article to write and I do that. And so I don't have an expense because it's effectively my own privately done SEO.

Russell Knight [00:14:47]:

So I don't have an additional expense. Additionally, I let my clients, my staff work from home. My staff members are mostly millennials. I'm a younger Gen X. I don't think that the office is magic, which a lot of my colleagues do. So that's a giant expense too. I don't advertise. I don't have an office that I have to pay for.

Russell Knight [00:15:09]:

I do have an office, but it's just— Yeah. —for 8 people and, you know, $30,000 a month. So my expenses are limited. And that flexibility to do fun stuff. Like, I take everybody on a big retreat every winter. We're going to the Phoenician in Scottsdale this— in a couple of weeks.

Darren Wurz [00:15:31]:

Sweet. Yeah.

Russell Knight [00:15:32]:

And we did Naples last year because, frankly, the firm is profitable. And so I can do fun stuff and I can give people bonuses that they deserve because I've reduced expenses where my colleagues are spending on buildings and Google Ads.

Darren Wurz [00:15:51]:

What we often find is that in terms of the levers of growth, the digital ad spend is last. It's the most expensive in terms of, it's the least ROI. A lot of the leads you get are not great. There are some other low-hanging fruit that you can knock out sooner, like referrals, you know, repeat customers, content. Sounds like content has really been the driving force for you, that you put out so much content and that's really worked. Yeah, that's great. Let's talk a little bit about your financial metrics and metrics that you use. Are there any specific metrics that you are watching, targeting, KPIs that you found have been really effective for you?

Russell Knight [00:16:46]:

I do watch to see the monthly gross revenue because it brings up good questions like January is busy, right? So you're like, okay, well, January is a lot busier than last year. Or you'll have like an odd, like an October where it's like, whoa, that was like a really good month, maybe what's happening? And usually you can ask your staff, even like a paralegal, and be like, what do you think is different this month? And they'll be like, well, you know, how do we just be busy? And like, the cases have been good or what have you. And also a slow month, they'll be like, well, we had to devote all this time to this one person and like, it ended up being a problematic case and we haven't gotten paid yet. That's what I've found is The big— for financial KPI is just that gross revenue number. It's both— it both tells you like the clients that are coming in and putting down retainers and the clients that are paying consistently and lets you know where you have a leaky bucket that you need to take a look at.

Darren Wurz [00:17:49]:

Yeah, that's good. You got to keep track of that and then ask the tough questions, which is great. So is that how you bring your team into understanding the financial performance of the firm or how do you get them to actually engage with that or understand that?

Russell Knight [00:18:06]:

I don't think— Well, again, KPI is the purpose of a KPI is not to determine your net profitability, is to get hints at other things. I call them leaky buckets because if the world was perfect, we'd all be making millions of dollars, right? But that's not the reality. It's usually there's We'd love to do, we all love to do that, but there's things getting in the way. So you have to figure out what's in the way. What's, what squeaky wheels need to get greased? So when you're having, so when things are good, you can have a very honest conversation with people in a group and say like, what made it good? Why is this year better than other years? And people will tell you like, well, you hired all this extra staff and like everyone's really in sync. And so the clients are happier. So we're getting paid more and we're getting good results. And then vice versa, if something is wonky, usually have to have a one-on-one talk and say like, hey, what's happening? It's usually like someone's hours, like, man, your hours aren't there.

Russell Knight [00:19:04]:

What's going on? It's usually something personal that we can get past. I'm happy to support people through something if they're expecting work. That's my job really is like to support everybody and we can get through that. So that's what the— the good metric is gross revenue and the bad metric is people's hours and not getting it because there's something wrong if they're not making their minimum hours or they're not striving to make excess hours.

Darren Wurz [00:19:32]:

Yeah, that makes a lot of sense. You know, part of profitability is really addressing those leaky buckets, which you mentioned. What are some common leaky buckets that you see Are there any that have been like repetitive or you see as common for other practices that we should really be paying attention to?

Russell Knight [00:19:52]:

There's going to be a million leaky buckets and the trick to getting a leaky bucket unleakable is you just got to watch it and let the people that you're watching it schedule a meeting about their leaky bucket, whether it's their hours or their follow-up or their their education, so they're becoming a better practitioner. If they will work on those items, if they know that there is a scheduled meeting about that item on a biweekly or monthly or quarterly basis, because if there's no check-in, then who cares? They're still going to do whatever they do.

Darren Wurz [00:20:30]:

Yeah, absolutely. Very cool. Well, Russell, what about, you know, software spend? You know, that, that I see as kind of a leaky bucket for a lot of firms. Especially with like AI and there's, you know, so many tools that we can spend on, how do you keep track of that and make sure you're not, or has that never been an issue for you?

Russell Knight [00:20:53]:

I mean, we use a, we use MyCase and then we also use Dropbox and we use Gmail and there's a Google Work app and there's expenses associated with that, but they're not too expensive. And just recently we finally, said like, we're going to do it right and have Thompson, pay Thomson Reuters like the couple hundred dollars a month. I don't even know what I think. It's like $800 for everybody to have access to West Publishing. And it's, I mean, it just makes us that much better. This, the whole point is like the bigger you get, generally expenses are fixed. I'll be quite frank. If I was a solo again, if something happened, I'd probably go work for somebody else because it's just not worth it.

Russell Knight [00:21:39]:

Mm. Yeah. If you have one associate, I always call it associate, but it's one solo and an associate. That's just a sidekick. That's just Batman and Robin. That's not the event. So what you want to do is you want to have as many people as possible because your fixed expenses will remain fixed whether you have 3 people or 12. And then, yeah, your variable expenses should be bonuses, should be money that's going to actual people and not to some software company.

Darren Wurz [00:22:08]:

That's how— Makes sense. Yeah.

Russell Knight [00:22:10]:

Who's— how you can benefit your core team. Give them money.

Darren Wurz [00:22:16]:

Yeah, absolutely. What would you say is kind of the break-even point? So solo, you're going to struggle with your margins. One attorney, probably going to still be struggling with your margins. When does it finally really start to take off?

Russell Knight [00:22:28]:

Well, it's probably two, probably two attorneys and two paralegals. It's probably— no, it's probably, you know, you, 2 attorneys, and then at least 2 paralegals, and then you should be moving in the right direction. And then once you have 5 attorneys and you should have 5 paralegals, you can really take your foot off the gas and be a business owner. But someone is going to have to supervise those paralegals. So, you better have a super paralegal or an attorney who can devote time to supervising the paralegals. And I've been blessed in having a person like that. And yeah, the more you can focus on the business and one, pay your staff appropriately and assure your staff that you will always get more business because you're willing to absorb risk and make sure that the phone keeps ringing, they will remain loyal to you and will be part of the team because they know that they're getting the support they need financially, the support they need to do the job they want to do. The support they need to be the attorney they want to be.

Russell Knight [00:23:35]:

It's a lot like people's careers are a lot, and it's my pleasure to shepherd their career in the direction they want to go. You want to be the best? Come join me. I'll help you.

Darren Wurz [00:23:46]:

Isn't that awesome? Right. You know, I feel kind of the same way. It's like you have the privilege of creating this place where people can come and work and can do what they love. And not have to worry about the business or whether we're going to make enough money. You know, I kind of experienced that in my own life. You know, starting out, I was all by myself. I had to worry about all of those things. But now, having the privilege to, to be able to create that place for other people, it's, it's really a truly honorable position to be in, and, and it's a great responsibility.

Darren Wurz [00:24:23]:

Have you— it sounds like you've enjoyed that, uh, that aspect of being a business owner.

Russell Knight [00:24:27]:

I mean, like, you only get one life, but at the same time, it's not fun to the same thing over and over again. I mean, I've done thousands of divorces. Do I really— I'm 47. Do I want to spend the next 20 years just, you know, plugging and chugging divorces? I love doing a divorce trial, don't get me wrong, but I'm doing things like I do a bunch of Instagram videos or I try to do CLEs and then I tape the CLE. I have it, I have it edited. I just do like other stuff where how can I be more out there so that people are aware of who I am and what the services I provide and why those services are effectively and fundamentally superior. And that's totally different than what I went to law school for, like a billion times different.

Darren Wurz [00:25:10]:

Yeah, absolutely. One final question. How do you incentivize your team? You know, as much as you're comfortable sharing with us, and do you tie that to financial performance? What have you found that works really well for you?

Russell Knight [00:25:25]:

My job is to absorb the risk as the business owner. The team does not absorb any negative risk. If somebody wants to do extra work by billing more, I don't care if we collect or not. You're getting paid for that work you did, whether it's by a bonus or something we work out. Different people have different needs. So I have different arrangements set for every single person, but what they want to do and how they want to get paid. And so I would ask them directly, what do you want? They probably want something very specific, and they probably don't want other stuff that frankly isn't on the table. Just give them what they want.

Russell Knight [00:26:05]:

If someone wants a raise, give them a raise. If someone is having something horrific happen, give them an advance. If someone is figuring out a way to make you more money, tell them you appreciate that, and how would they like to be compensated? They will tell you. And if they're making you money, you should say, yes, I'll do

Darren Wurz [00:26:30]:

that. Sounds like it boils down to really understanding your people and communicating effectively with them. Would you agree with that? Yeah.

Russell Knight [00:26:38]:

And getting out of your own way, like, stop being cheap.

Darren Wurz [00:26:41]:

Stop it. Yeah, true, true. Yeah. You know, it's not all about, you know, making as much money as you can at all costs. It's about you know, you'll find that that eventually doesn't make you as much money as you want. Having a great team that's happy and loves what they do and loves where they work, now they will perform really, really strongly for you and then you will make more money. Absolutely. Well, Russell, some great nuggets that you've given us today.

Darren Wurz [00:27:12]:

Finally, I want to ask you, you know, what for the solo or really small family lawyer out there who's trying to grow, What is one last piece of advice that you might have for them to

Russell Knight [00:27:27]:

grow? There's 3 things you got to do to grow. You got to market, which just means people are being aware of you, whether you're waving a sign. When I started, I speak Spanish. I put up little billets in the lavanderías that said, "Abogado hispanohablante," and they would tear it off just like for a guitar lesson or something. Did I make a lot of money doing that? No, but I didn't sit at home hoping somebody would notice who I was. You got to get out there and do something. Sales, when people call you up, you got to learn how to talk to people and you probably don't know what you're doing on the phone. You got to hire a sales coach.

Russell Knight [00:28:03]:

It's not that expensive and it turns, let's call, let's say even if it turns like a 30% conversion rate into a 50% conversion rate, it'll pay you within a month or two. It's not a problem. And then third, you got to collect. Now you have the clients, make them pay. So if you have the clients and the clients are paying, you should have a big pile of money. And then all these top— getting all these people to work for you and do the job, you won't have a problem with that because you'll just hand out the big pile of money.

Darren Wurz [00:28:34]:

Yep. Great advice. You got, you got to hustle. You got to get out there. Got to get the clients. You got to be a good salesperson, 100%. That's a unique skill. And then you got to get them to pay.

Darren Wurz [00:28:44]:

Great advice, Russell. Well, thanks so much for joining us today. Where can folks go to learn more about you?

Russell Knight [00:28:51]:

If you live in Illinois, you can go to rdklegal.com. That's Russell D. K. as in Knight legal.com. And if you're in Southwest Florida, where I also have a practice in Chicago's best suburb, Naples, Florida, you can go to divorceattorneynaplesfl.com. Or just Google me. I'm easily the easiest guy to find probably in America for family law in— if you just Google me, Russell Knight.

Darren Wurz [00:29:18]:

Great. All right, well, thanks, Russell. Thank you.

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Profit First Pt 6: Destroying Law Firm Debt by Fixing Your Cash Flow (Ep. 154)