Why Do Lawyers Charge So Much Money? 9 Reasons

Ever wonder how and why lawyers charge so much money? Here's 9 reasons explaining exactly why and how they can and do charge so much in legal fees.


Client paying a lawyers legal bill

Nobody wants to hire a lawyer.  It’s usually for a bad situation.

I should say, nobody wants to pay legal fees.  They often are really high.  Legal work can take a lot of hours and some lawyers charge a lot per hour.

It’s not unheard of for senior attorneys to charge $500 or more per hour these days.  For most people, that seems like an astronomical amount of money.  Yes, it’s a lot, but there are reasons explaining why lawyers do charge a lot of money.

Those reasons are set out below.

1. Need lots of education

In Canada and the USA, lawyers need to go to post-secondary school for years.  It’s a long haul.  Many go longer.  Generally, the more education, the higher paying the job.  That’s a big reason people get advanced jobs (not always, but some).

Not only does college and law school cost a lot of money, a person doesn’t earn much or anything during those years.  It’s a big opportunity cost.  The thinking is it’s worth investing money and opportunity cost because income will be higher in the future.

If lawyers earned little money, who would go through all that education?  Some might, but not nearly enough.

2. Steep on-the-job learning curve

Law school is just the start.  Practicing law requires learning an incredible amount of skills and knowledge.  It takes approximately 10 years to become a skilled lawyer.  Most lawyers continually hone their trade their entire career.

3. Highly Regulated = Few Lawyers Relative to Population

Not just anyone can be a lawyer.  There’s a rigorous gate-keeping system.  You need a law degree.  You must pass the bar exam.  These are huge hurdles to overcome and take years to do so.

Since the number of lawyers is restricted, basic supply and demand results in lawyers being able to charge more money.

4. Big Stakes = High Stress

Helping people and businesses with legal issues can have serious outcomes.  It’s a big stakes vocation.  Losing a criminal defence trial means someone could go to jail. Corporate work involves billions of dollars.  Divorces impact the lives of kids.  Personal injury cases can make or break a victim’s future.

These are high stakes situations that are stressful.  I’m not saying that other jobs aren’t stressful, some are more stressful but pay less.  However, in combination with the other reasons on this page, stress results in some lawyers wanting to charge a lot of money for some cases because of the complexity involved.

5. High-value services

Legal work is not like producing widgets.  Every case is different and requires thought, analysis, research, negotiation and more.  The situations are often serious.

A person charged with a crime will spend almost anything for a chance to stay out of jail.

A skilled personal injury lawyer can obtain big damages awards for their clients… much more than the client could get on their own.

A corporate lawyer can help businesses save or earn millions or billions of dollars with legal work.

The fact is nobody thinks or cares about lawyers until they need one because they can do things non-lawyers can’t.


It’s like surgeons – they can do things nobody can.

6. Student loans

Student loan photo with diploma and cash



I alluded to all the schooling needed, but these days many lawyers had to take out huge student loans to get a law degree.  I’m not talking about ten thousand dollars.  I’m talking about hundreds of thousands of dollars.  This takes years to pay off and it can only be paid off with a good salary.

7. High overhead

This is one thing they don’t tell you in law school and that is the business of practicing law.  Running a law firm isn’t cheap.  You have monthly overhead that must be paid every month.  It’s expensive.  Here are the minimal expenses most lawyers who run their own firms need to pay each month.

  • Office lease:  This can be inexpensive in lower cost areas or extremely high in downtown urban locations.
  • Staff:  This is often the biggest expense.  Skilled legal secretaries, paralegals and associate lawyers all command good salaries which adds to the overhead.
  • Insurance:  Lawyers must buy malpractice insurance which isn’t cheap.
  • Supplies and tech:  This isn’t too much, but it adds up – staples, computers, paper (lots of paper), photocopier, etc.
  • Ongoing education:  Most lawyer oversight bodies require that lawyers pay for and attend ongoing education each year. These seminars are not cheap.
  • Advertising:  Some lawyers invest a ton of money into advertising to attract new clients.  For some law firms, this can be the biggest expense.

8. Partnership buy-ins

For lawyers who go the firm route and are invited to become partner, don’t enjoy that promotion without paying for it. Most firms require new partners to buy-in.  The amount can vary from a few thousand to millions of dollars, depending on the firm.  You no sooner pay off student loans and then you take out another loan to be a partner.

9. Because they can

At the end of the day, basic economics reigns supreme.  Lawyers charge a lot of money because they can and people/businesses will pay.

That said, not all lawyers charge a lot of money.  Some practice poverty law or are young or for whatever reason keep their fees lower.  It’s unfair to say all lawyers charge a lot because not all of them do.  That said, give the costs of being a lawyer, most charge more per hour than many other jobs.