The 2024 edition of The Financial Wellbeing in Law Review highlights a worrying trend in the legal profession. Financial stress is severely impacting lawyers’ wellbeing and threatening the business success of law firms across the UK.

The report draws on insights from over 500 lawyers across the UK on the impact of financial insecurity on productivity, retention, and the mental health of legal professionals.

Financial wellbeing: a business-critical issue

Carla Hoppe, Founder and CEO of Wealthbrite, emphasises the growing importance of financial literacy within the legal profession: “Financial wellbeing isn’t just about doing the right thing—it’s about survival and success in a hyper-competitive market. Stressed, financially insecure lawyers are less productive and more likely to leave. That’s a risk no firm should be willing to take.”

• 61% of UK lawyers struggle with financial confidence.
• 89% of lawyers at the start of their careers worry about money almost every day.
• 34% of lawyers admit their performance is directly affected by money worries.

With turnover rates in law firms already high and the majority of NQ (newly qualified) lawyers frequently worrying about money, the report projects that financial stress will exacerbate attrition rates over the next five years. Law firms risk losing valuable talent not just to competitors but to entirely different sectors that prioritise financial education and wellbeing.

Law firms lagging behind other industries

The findings highlight how the legal sector trails behind other industries, such as tech, in addressing financial confidence:

• 48% of lawyers report turning to credit because they have run out of money regularly, compared to only 24% of employees in the tech sector.
• Gallup analysis shows that engaged employees require a 31% pay increase to consider leaving for a new role, compared to just 22% for disengaged employees.

This gap leaves law firms at a competitive disadvantage regarding talent retention and engagement. The report warns that firms that ignore financial wellbeing could face a significant talent drain in the near future.

Financial confidence and mental health in the legal profession

The report also explores the mental health toll caused by financial stress:

• 82% of junior lawyers report frequent worries about money.
• 60% of lawyers feel the need to spend beyond their means.
• 42% of lawyers turn to credit cards because they’ve run out of money.

Financial pressures are causing depression, anxiety, sleepless nights, and a lack of motivation, creating a workforce that is stressed and underperforming.

A call to action for law firm leaders

The report calls for leadership in the legal sector to prioritise financial literacy as part of their broader talent retention and mental health strategies. It urges firms to move beyond outdated communication methods, such as emails, and engage staff through interactive and engaging learning experiences.

Wealthbrite’s founder, Carla Hoppe, summarises: “The legal profession is at a crossroads. Firms need to create a workforce that is not only resilient but empowered to drive results and impact the bottom line. That starts with financial confidence.”

*Report Produced by Wealthbrite