Attorneys: Avoid these financial pitfalls in litigation
Our settlement planning team works with both plaintiffs and attorneys as they think ahead to settlement and how the money could be most beneficial. Along that path toward the end litigation, however, financial issues can arise and cause unnecessary complications. We in the civil justice community want what’s best for each person who pursues justice, and ensuring smooth sailing after litigation is a big part of success. Consider these three tips to prevent or mitigate the variety of financial issues that can come up.
Tip 1: Know Your Client’s Finances
Great attorneys know their clients well, but they may not know every single detail of each client’s financial life. Take into account the effect that the following information might have on your client’s ability to stay solvent throughout litigation and what their financial expectations might be:
- Credit score,
- Mortgage rate and balance,
- Personal balance sheet,
- Health care insurance plan, and
- Eligibility for needs-based government programs like Supplemental Security Income (SSI) and Medicaid.
You may want to consider hiring a financial expert to conduct the exhaustive due diligence associated with the many settlement-related financial decisions.
Tip 2: Know Your Client’s Stakeholders
When a person pursues a large settlement, people inevitably come out of the woodwork. By distinguishing upfront the real stakeholders from the fair-weather friends, you can understand who is shaping your client’s view of the settlement. A good suggestion might be touching base with your client on a monthly basis to stay up-to-date on any changes in the interested parties.
Tip 3: Know Your Client’s Psyche
Many plaintiffs who have suffered through a personal injury or the death of a loved one have never seen wealth. Litigation is a daunting process for those who have never been through it. The idea of then taking the settlement money and creating a lifelong plan can seem impractical to someone who has been through a personal or physical trauma. Employing a holistic approach that addresses best possible outcomes versus worst possible risks can help mitigate some of the uneasiness inherent to the settlement.
Attorneys who “follow the dollar” and proactively develop an understanding of a client’s financial situation find it easier to create an environment in which they have faith that post-litigation life will meet their expectations.