When an individual is in need of legal guidance, advice or representation, researching and hiring an experienced attorney is a common practice. As expected, lawyers and attorneys are hired to provide their expertise to help clients and businesses navigate the complex nature of the legal world. Despite this, before legal services can be guaranteed, clients often encounter a retainer fee. But what exactly is a retainer fee, and how does it work?
What Is the Purpose of a Retainer Fee?
Simply put, a retainer fee is a sum of money paid to a lawyer or law firm upfront to secure their services and ensure their availability for your legal needs. Think of it as a down payment or an advance payment for legal services. This fee is typically required by the attorney before they start working on your case, and it serves a variety of key purposes, including compensation for initial work, prepayment for future legal services and risk mitigation, to name a few.
When a prospective client pays a retainer fee, they are essentially reserving the lawyer's time and legal expertise, confirming that said attorney is available to work on their case when needed. Additionally, a retainer fee will also help establish a binding financial commitment between the client and their attorney of choice, which ensures that the client is serious about pursuing their legal matter. Having a retainer fee requirement provides a much-needed sense of financial security for the lawyer in question, allowing them to allocate their time and resources to the client's case, which promotes a productive working relationship between client and attorney.
What Are the Advantages and Disadvantages of a Retainer Fee?
As previously stated, a retainer fee allows a client to pay a specific sum of money upfront in order to secure the services of an attorney. But it doesn’t come without both advantages and disadvantages. On the positive side, it gives a client peace of mind and ensures that access to legal counsel is at their disposal. Additionally, retainer fees are often structured to provide a level of predictability in future legal costs. However, some disadvantages include a high upfront retainer cost, which in some cases might be too much for certain clients. Additionally, if clients feel compelled to continue with the same attorney despite a change in legal requirements, the retainer fee is typically non-refundable. Before paying a retainer fee in exchange for legal services, individuals should remain aware and carefully consider all terms in the retainer agreement in order to successfully navigate these pros and cons effectively.
