Canadian Lawyer

w w w . C A N A D I A N L a w y e r m a g . c o m J U N E 2 0 1 5 29 he Canadian Bar Association Financial Services Corp. offers a number of services to help lawyers plan for retirement. They include investment and savings products designed for and available exclusively to lawyers, their staff, and their families, RRSPs, TFSAs, individual banking services, and group RRSP plans for law firms. It offers licensed financial advisers available across the country to meet and help lawyers and their spouses develop and implement individual retire- ment goals, including regular monitoring. CBAF's investment line-up itself includes Retirement Date Funds — ready-made portfolios geared to a lawyer's date of retirement. Each portfolio is allocated among a number of different segregated funds based on a split between fixed income and equity geared to the date of one's retirement. The allocation is adjusted automatically over time to become more conservative as the lawyer approaches retirement. In addition, CBAF's program also shows lawyers their personal- ized rates of return so they can determine if they are meeting their investment goals. There are also Internet-based tools available from CBAF, including the following: 1) Steps program: a tool that helps lawyers to determine which set of variables are applicable to them (including retirement age, level of regular savings, future savings/inheri- tance, and investment style). Unlike other retirement projec- tion programs, Steps does not require the lawyer to input the exact dollar sum needed for retirement (unless they want to), rather, one simply chooses one of the lifestyles depicted in the program and Steps then "costs" that retirement, inflation adjusted. Steps also help lawyers determine their appetite for risk based on a series of behavioural questions and then recommends an appropriate portfolio mix. Also, the lawyer's progress towards his or her retirement goal is displayed on the first page of every investment statement so it can easily be determined whether one is on track and if not, what reme- dial actions should be undertaken. 2) Retirement Income Illustrator: this provides a detailed schedule showing legislated and variable withdrawals from a registered or defined contribution pension so the lawyer can determine how long their savings will last under different rates of return and withdrawal scenarios; and 3) Learning centre: an array of education tools, such as a "pay yourself first" calculator showing the benefit of putting money aside on a regular basis; a Retirement IQ Quiz; learning modules (some in video format); games and quizzes; many different investment calculators; and a new "Ride To 65" game that gives lawyers the opportunity to explore and learn smart money-management tips in an online virtual world. — JB T profession itself. Many thought when they joined a firm, if they worked hard and became a partner they would work there until retirement and the firm would take care of you; now it's all changing. I've seen people in their late 40s and 50s — the worker bees — getting pushed out." Most firms don't have pension plans and even some of the firms that do and have amalgamated are grandfathering pensions going forward, says MacKillop, who represents partners who find themselves in battles with their firms over compensation or being let go. He's handled 15 such cases in the last two years. "The treatment sometimes is very harsh. It's about passing the work down to the younger lawyers so the firms can charge less. I've seen partners with 25 to 30 years of service who are told they have to leave and they're like deer caught in the headlights." Calgary tax lawyer Roy Berg agrees that as a profession, lawyers are probably more focused on their work than saving for the future. "Lawyers are in a tough spot because it's really up to us, as people who don't typically have pensions or stock options and forced retirement savings, to plan for retirement. A lot of times, as retirement planners we make better lawyers," says Berg, a partner at Moodys Gartner Tax Law LLP. "Every practising lawyer knows dozens of guys who are the senior lawyer with kids in private schools, they have paid for university educations for their kids and take nice trips and really can't afford to retire because they've consumed all their capital as they've gone along and have not properly planned." Moodys has a group RRSP for its lawyers, a rarity in today's law firms. Many firms feel it's too paternalistic to impose any kind of forced savings on their lawyers. But for both retirement and tax rea- sons, Berg says it can be hugely beneficial. "Lawyers often get into trouble because as partners there is no source withholdings. So at the end of the year, you owe a whack of money," he says. While it doesn't have a pension plan, partners at Lerners LLP con- tinue to receive some income during their transition into retirement, based on files they brought in while at the firm. "I think most firms say it's the lawyer's responsibility and not only should the partnership not want to interfere in your personal life but we don't have any duty, obligation, or responsibility to do so," says partner and executive com- mittee member Lisa Munro. "Many people feel their firms already control too much of their lives." Many firms have a fixed retirement age at which time they get their capital investment back, so for some, like WeirFoulds LLP, that age is 70 but is in no way a hard stop. At age 70 the firm will often "reset" the relationship for those who want to continue working. "It's that age for a reason," says Lisa Borsook, executive partner at the Toronto firm. "Half of the lawyers here are litigators and in our view litigation law- yers have a longer runway. I have litigators reaching their prime at 65. I'd be insane to dump them overboard." Law firms are also no longer the stable homes of partners who would stay with the same firm their entire career. Opportunity, feeling more valued, or a sense of increased security elsewhere lead lawyers to move around more — especially if they feel they are getting pushed out or into roles with lower compensation. With fewer big deals, an emphasis on mediation to avoid litigation whenever possible, and pres- sure from corporate clients to lower fees, law firms are feeling pinched and having to re-evaluate compensation plans for some lawyers. Part- ners are being pressured to bill more and older partners with big books of business want to stay longer. MacKillop says firms often have a 10-year payout for partners, of say $75,000, which is based on how many years the lawyer has been an MAKE A PLAN

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