How Much Does It Cost To Start A Law Firm

By Catherine Brock

You need capital to start a new law firm, but how much, exactly? There are different answers to this question. You could take an ultra-budget approach that involves networking, fielding phone calls from your personal cell, working from home, and using an existing laptop. 

Unfortunately, avoiding too many costs can backfire later. Without setting up the right tools and organizing your law firm from day one, administrative tasks can quickly become unmanageable. As an example, you may find yourself buying a scanner at 6:00 p.m. on a Friday—when you still have a pile of client work to finish before the weekend. 

How Much Does it Cost to Start a Law Firm?

Law firm startup costs can include location, licensing and insurance, office equipment, and legal practice management software.

A realistic start-up estimate incorporates initial costs plus at least six months of primary expenses. It also includes investments in items the firm will need eventually, such as a quality scanner and printer.As a rough estimate , law firm start-up costs may total about $8,200. Note, this estimate may vary based on state. The table below outlines the components of that sum. 

Description Expense 
Location  $2,100
Insurance and licensing  $575
Office Equipment  $1,500
Marketing  $2,365
Legal Practice Management Software $414 
Other Law Firm Start-up Costs $1,200

Primary Law Firm Start-up Costs 

Primary start-up costs cover your firm’s location, insurance and licensing, office equipment, marketing, legal practice management software, plus a few miscellaneous expenses. Read on for the breakdown of these costs, why these investments are needed, and where you can cut corners if you must. 

Location Costs 

A law firm needs a dedicated location. That space could be an office in your home, a spot within a co-working facility, or a leased office suite. Depending on which option you choose, your location costs could be anywhere from zero to $5,000 monthly:

  • A home office is free. 
  • A floating desk in an open co-working space can cost $50 or more monthly according to osDORO
  • A dedicated desk in an open co-working space can cost $250 or more monthly according to Buildremote
  • A private, furnished office in a co-working space can cost $350 to $800 monthly, according to
  • A small or medium, unfurnished commercial office suite can be $500 to $5,000 monthly depending on size and location, according to

Location Considerations 

Using free space at home is attractive economically, but it may not suit your business model or target clientele. Before committing to a location, consider: 

  • The privacy needs of your clients. Whether you plan to host client meetings in person or remotely, the firm needs a private space with a door. A floating desk in a co-working building doesn’t provide the privacy required for phone calls and video chats. However, some coworking spaces allow tenants to reserve conference rooms. You might initiate a floating desk arrangement even if you only use it for periodic access to the conference room. 
  • The space you need for equipment and files. Even with a paperless office system, the firm needs space for a scanner and printer, for documents that need to be digitized, reference materials, plus adequate surfaces for writing and computing. 
  • The impression you want to make. You may prefer to meet clients in-person at a commercial location, rather than your front door. 
  • Your municipality’s restrictions on customer traffic. Some cities may limit the customer traffic allowed at home-office locations. 
  • Your privacy needs. Running your law firm from home makes your address public information. You can use a mailbox service to retain some privacy, but that approach has limitations. You’ll still share your home address when meeting with clients and, possibly, on certain public documents like business license applications. 

Given the above factors, a private office in a coworking facility is often the best choice for new firms. This solution balances cost with privacy. 

These law firm startup cost estimates include $2,100 to rent a furnished office in a coworking space for six months. 

Insurance and Licensing Costs 

Once you choose your office location, you might be tempted to dive in and start setting up shop. But there are two details to address first: insurance and licensing.

Insurance for New Law Firms 

A new firm should have general liability insurance and professional liability insurance. These two coverages protect you from property damage claims, libel claims, and malpractice claims. Later, you may want to add cyber liability insurance, which can help pay for claims related to a security breach of your online systems and files. 

The cost of insurance for new law firms varies widely, depending on field of practice and location. These estimates can guide your planning: 

  • General liability insurance premiums can be $250 to $600 annually according to Forbes
  • Professional liability insurance for low-risk practices averages $300 to $500 annually, according to BravoPolicy.
  • Cyber liability premiums average $1,740 annually according to TechInsurance

These law firm startup cost estimates include $275 to pay for six months of general and professional liability coverage. 

Licensing for New Law Firms 

For our purposes, licensing costs include fees associated with establishing your new firm as a business entity plus any local licensing requirements. 

Depending on where you live, you might be able to set up the new firm as a Limited Liability Partnership (LLP), Corporation, Limited Liability Company (LLC), or a professional association. You may additionally need to secure a business license from your state and/or your local municipality. 

Filing fees for new business entities and licenses can range from $50 to $500 or more. We’re assuming an average cost of $300. Check with your state and locality, then adjust this estimate as needed. 

Office Equipment Costs

A solo law firm, at a minimum, requires a laptop, scanner, printer, telephone plus supplies such as paper, pens, and envelopes. Cost estimates on these items are: 

  • Laptop: PCMag’s list of best business laptops includes equipment priced from $1,020 to $2,299. A good budget may be around $1,500. 
  • Scanner: A solo law firm can use a high-resolution desktop scanner with a high-capacity sheet feeder. Duplexing and support for letter- and legal-size scans are also important. Scanners with this feature set tend to cost around $1,000.
  • Printer: You can buy a good, but basic laser printer for $350. You probably don’t need a multifunction printer unless you have a dedicated phone line for faxing. You can alternatively subscribe to an e-fax service for about $25 monthly. Our cost estimate includes $350 for a printer plus $150 for a six-month e-fax subscription. 
  • Telephone: A dedicated business line is a must. You can tackle this need in a couple ways. Subscribing to a virtual phone number, which uses the internet and an app to make and receive phone calls and text messages, is the most economical option. These generally cost about $100 for six months of service. You could alternatively use a dedicated smartphone or set up a dedicated landline. These options will cost $300 or more for six months of service, plus upfront equipment costs. Our start-up estimate includes $100 for the virtual phone option. 
  • Supplies: A good budget may hover around  $200 for basic office supplies. 

Marketing Costs 

Your opening marketing budget should account for a logo, website, and software to track leads. The logo is an important design element that you’ll use on the website, social media profiles, letterhead, invoices, and more. The website is where people end up when they search online to find “law firms near me.” And your lead-tracking software helps you convert those website browsers into clients. 

Logo Design 

Logo design can cost $250 or more, depending on how you source it. See gig sites like Fiverr and Upwork for low-cost providers. 

Our $8,200 estimated cost of starting a law firm includes $250 for logo design. 


Contract with an agency and you’ll spend $10,000 or more on designing and building a website. Alternatively, if you are technically savvy, you could use a free website builder or template to make it yourself. You’ll still have some costs, though—including $15 to buy a domain name, $30 to $100 monthly for hosting, and $500 or more annually for maintenance. 

Many new lawyers, however, prefer to leave the technical work to experts. That frees up time to secure new clients and represent them. One cost-efficient option is to work with a practice management provider that also builds websites. For example, MyCase team builds compliant law firm websites for its subscribers. The cost is $1,500 plus $100 monthly for hosting and support. 

Our estimated cost to start a new law firm includes $2,115 for the domain name, website, and six months of hosting. 

Tracking Leads

You can assume every prospective client who reaches out to you is also interviewing other lawyers. Following up with these inquiries is how you demonstrate professionalism and sway them to contract with you rather than your competition. Lead tracking software supports this effort by documenting your outreach efforts, along with each prospect’s contact information and concerns.  

Tracking leads also establishes patterns for converting prospects to clients. This type of data can help you customize your follow-up processes to improve your conversion rate. 

Standalone small business lead tracking systems, known as customer relationship managers or CRMs, typically cost $25 to $50 monthly. 

You could also choose a practice management application that includes CRM capabilities at no extra charge. MyCase has this functionality, along with an integrated client intake system

Our estimated cost of starting a law firm doesn’t include an extra line item for lead tracking. Instead, the cost is embedded in legal practice management software costs, as explained below.  

Legal Practice Management Software 

Case management software organizes case files and streamlines time tracking, invoicing, calendaring, and client communications. The best applications also include secure, cloud-based storage. This eliminates the need to set up and maintain a physical server in your office. 

MyCase is a top-ranked law practice management software that is both comprehensive and easy to implement. From lead tracking to billing and payments, MyCase handles a firm’s core administrative and case management tasks seamlessly. The application also integrates with many popular legal apps, including LawPay, Quickbooks Online, Gmail, InfoTrack, and more.

Managing your firm through a central application that’s designed for your workflow is the ultimate time-saver. You’ll be more focused on legal work and your clients will be happier as a result. 

MyCase is $69 monthly for the plan which includes client intake management, unlimited e-signatures, advanced billing and invoicing, and secure document sharing. Our estimated cost to start a new law firm includes $414 for six months of service. 

Other Law Firm Startup Costs 

Software that helps with research, accounting, and productivity should also factor into the cost of starting a law firm.
You may also want to invest in a legal research tool, accounting software, and document software.

Legal Research 

Lexis Nexis and Westlaw are two popular legal research solutions. Both have multiple plans, with an entry price point of  about $100 monthly per user. 

Accounting Software

MyCase has accounting features, but you’ll likely want to use those alongside a comprehensive financial application. That way you can manage your bank accounts, overhead expenses, fixed assets, and taxes appropriately. 

Quickbooks is a popular choice for law firms. The pricing starts at $90 monthly. Often, you can get a discounted rate for the first few months. 

Document Software

Word processing, spreadsheeting, and presentation tools are essential for any small business, including young law firms. Google Workspace or Microsoft 365 can provide these applications for about $10 per user monthly.  

Final Notes

How much does it cost to start a law firm? By a rough estimate, about $8,200. You could do it for less, but it may not be worth it. You’ll likely be delaying expenses and decisions, which creates more work later. 

Start the firm on the right path with investments in a professional location, the appropriate licensing, quality office equipment, basic marketing collateral, and software that supports your workflow. Selecting a legal practice management software may be one of your most impactful start-up decisions. For legal billing and payments, book a personalized LawPay demo. For comprehensive legal case management, book a customized MyCase demo.