Building an IT budget can seem straightforward until you start adding up everything that falls outside the monthly IT support bill.
Building an IT budget for a law firm can seem straightforward until you start adding up everything that falls outside the monthly IT support bill.
Managed IT may be one of the largest predictable expenses, but it isn’t the entire technology budget. Microsoft 365 and other software, cybersecurity, backup, computers, network equipment, projects, and unexpected needs all have to be considered.
For a 20–30 employee law firm planning its 2027 budget, a better approach is to break technology spending into five categories:
- Managed IT services
- Microsoft 365 and cloud licensing
- Cybersecurity and backup
- Hardware replacement
- Strategic projects and contingency
Here’s how to think through each one.
#1 Start With Your Managed IT Costs
Managed IT is usually one of the easiest technology expenses to plan because it is recurring and relatively predictable.
For planning purposes, Ferrari Networks currently uses approximately $150–$200 per user per month as a managed IT benchmark for firms in this size range. This is a Ferrari Networks planning figure, not a universal market rate.
| Firm Size | Monthly Managed IT | Annual Managed IT |
| 20 employees | $3,000–$4,000 | $36,000–$48,000 |
| 25 employees | $3,750–$5,000 | $45,000–$60,000 |
| 30 employees | $4,500–$6,000 | $54,000–$72,000 |
Actual costs depend on the firm’s environment and what the managed IT agreement includes. Security requirements, number of locations, on-site support, servers, backups, legal applications, projects, and strategic IT planning can all affect pricing.
This is also why comparing providers based only on the monthly per-user number can be misleading. Two agreements with similar prices may include very different services.
#2 Account for Microsoft 365 and Other Software Separately
One of the biggest IT budgeting mistakes a law firm can make is assuming:
Monthly managed IT fee = total technology cost.
It usually doesn’t.
Depending on the agreement, a firm may separately pay for Microsoft 365, practice management software, document management, PDF software, legal research, e-signature platforms, password management, security awareness training, backup, VoIP, AI tools, and other cloud applications.
Microsoft 365 provides a useful example. Using a hypothetical licensing cost of $22 per user per month, a 25-user firm would spend:
25 users × $22 × 12 months = $6,600 per year
That expense would be in addition to managed IT if licensing isn’t included in the firm’s agreement.
Because vendor pricing and packaging can change, confirm current Microsoft pricing before approving the final 2027 budget rather than treating today’s price as a guaranteed cost for next year.
The same principle applies to other subscriptions. Instead of allowing them to disappear into miscellaneous operating expenses, identify recurring technology subscriptions and determine who owns each cost.
#3 Build Cybersecurity and Recovery Into the Operating Budget
Cybersecurity shouldn’t appear in the budget only when something goes wrong or a new product needs to be purchased.
A law firm’s ongoing security needs may include multi-factor authentication, endpoint security, email protection, monitoring, backup and disaster recovery, security awareness training, vulnerability management, incident response planning, security assessments, and cyber insurance preparation.
That doesn’t mean each item necessarily requires a separate purchase. Some may already be included in managed IT or another existing service.
Before adding more cybersecurity spending, leadership should ask: Which risks are we responsible for managing, what protections do we already have, and where are the gaps?
That question is more useful than choosing an arbitrary cybersecurity budget. It also helps prevent the firm from paying twice for overlapping services while overlooking something more important.
NIST’s Cybersecurity Framework 2.0 approaches cybersecurity as ongoing risk management across six functions: Govern, Identify, Protect, Detect, Respond, and Recover. For budgeting purposes, the important takeaway is that cybersecurity isn’t one product or one annual project. It is an ongoing business responsibility.
Recovery deserves the same attention. A backup has limited value if nobody knows whether the firm can restore the data when it is actually needed. Regular backup testing should therefore be part of the firm’s recovery planning, not something leadership assumes is happening.
#4 Stop Treating Computer Replacement as a Surprise
Computers, firewalls, wireless equipment, switches, servers, battery backups, and other infrastructure eventually need to be replaced. A law firm shouldn’t discover those costs only after equipment fails.
Instead, maintain a hardware lifecycle that identifies:
- What equipment the firm owns
- When it was purchased
- Its warranty and support status
- Its expected replacement year
- Estimated replacement cost
- How critical it is to the business
Consider a 25-person firm with six computers due for replacement in 2027, another seven in 2028, and a firewall replacement expected in 2028. Those aren’t necessarily emergencies. They’re foreseeable expenses that can be incorporated into a multi-year technology plan.
This is also where recurring IT support and strategic IT planning start to differ. Help desk support addresses today’s technology problems. A technology roadmap helps leadership anticipate what is likely to need attention next year and beyond.
For law firms unsure where that strategic responsibility belongs, we’ve covered the distinction between managed IT and vCIO services for law firms in more detail.
#5 Leave Room for Projects, Growth, and the Unexpected
Not every technology expense can be predicted perfectly. A law firm may open or relocate an office, hire several people, migrate its practice management system, replace its phone system, redesign its network, address a security issue, or make a significant vendor change.
That doesn’t mean leadership has to predict exactly what will happen. It means the annual IT budget should leave room for projects and contingency rather than committing every technology dollar to recurring expenses.
A contingency reserve can also reduce the tendency to make rushed decisions when something unexpected occurs.
What Could a 25-Employee Law Firm’s 2027 IT Budget Look Like?
Consider a 25-employee Western New York law firm. Using Ferrari Networks’ current planning benchmark, managed IT could represent approximately $45,000–$60,000 annually.
Then the firm would separately identify:
- Software and licensing: Microsoft 365 and other recurring applications not included in managed IT.
- Cybersecurity and backup: Any necessary protections or recovery services that aren’t already included elsewhere.
- Hardware: Computers and infrastructure scheduled for replacement during 2027.
- Projects: Known technology initiatives planned for the year.
- Contingency: Funds reserved for unexpected technology requirements.
The point isn’t that every 25-person law firm should arrive at the same total. They shouldn’t. The value of the exercise is that leadership can see where the money is going before those expenses arrive.
What Percentage of Revenue Should a Law Firm Spend on IT?
There isn’t one percentage that responsibly applies to every 20–30 employee law firm. Two firms with the same number of employees can have very different technology needs based on their practice areas, software, number of offices, cybersecurity requirements, remote-work environment, client requirements, growth plans, and existing infrastructure.
Instead of asking: “Are we spending the right percentage of revenue on IT?”
A more useful question is: “Does our technology budget adequately support the firm’s operations, security, continuity, and growth?”
That shifts the conversation from chasing a generic benchmark to understanding whether the firm’s technology spending has a business purpose.
The Four IT Numbers Every Managing Partner Should Know
Managing partners don’t need to understand every line of every technology invoice. But leadership should be able to identify four numbers.
- Monthly recurring technology spending. How much does the firm regularly spend on managed IT, Microsoft 365, software, cloud services, telecommunications, and cybersecurity?
- Annual hardware replacement budget. Which computers and other equipment are scheduled for replacement this year, and what should those replacements cost?
- Planned project budget. Which technology initiatives are expected during the year?
- Contingency reserve. What money is available if an unexpected technology need appears?
If nobody can readily answer those questions, the firm may be paying its IT bills without actually having an IT budget.
How a vCIO Can Help Build the Budget
This is one of the areas where strategic IT planning can add significant value. A vCIO can help leadership determine which equipment needs replacement, which projects should happen first, what can wait, where spending overlaps, how growth will affect technology needs, and what should be incorporated into a longer-term roadmap.
The goal isn’t simply to increase technology spending. It’s to make that spending intentional. A good planning process should also help a firm recognize when recurring problems are signaling a larger issue. We’ve identified several IT mistakes that can contribute to law firm downtime, many of which become easier to address when technology decisions are planned instead of made reactively.
10 Questions to Ask Before Approving Your 2027 IT Budget
Before leadership signs off on the budget, ask:
- What is our true annual recurring technology cost?
- Which equipment is approaching end of life?
- Which computers need replacement in 2027?
- What major technology projects are planned?
- Which cybersecurity risks require attention?
- Are backup and disaster recovery adequately addressed?
- Are we paying for duplicate software or security services?
- Are hiring, expansion, relocation, or other business changes expected?
- Which technology expenses surprised us during 2026?
- What contingency have we built into the 2027 budget?
If your IT provider can’t help answer those questions, you may have technical support without enough strategic technology planning.
Turn Reactive IT Spending Into a 12-Month Plan
Imagine a 25-employee Western New York law firm entering 2027 without a formal technology budget. IT expenses have traditionally appeared whenever something breaks, needs renewal, or suddenly becomes urgent.
A planning review identifies several aging computers, recurring Microsoft 365 licensing, a firewall approaching replacement, cybersecurity improvements, backup and recovery needs, a planned new hire, and the firm’s managed IT costs.
Instead of approving each expense independently throughout the year, leadership can turn those needs into a 12-month plan. High-priority equipment and security needs might be addressed first, followed by standardization work, preparation for staffing or office changes, and a fourth-quarter review that becomes the starting point for the 2028 budget.
The benefit isn’t necessarily spending less.
It’s reducing surprises.
IT Budget Planning for Western New York Law Firms
Ferrari Networks works with 10–50 employee law firms throughout Buffalo, Niagara Falls, and Western New York to connect day-to-day IT support with longer-term technology planning.
That can include managed IT services, hardware lifecycle planning, cybersecurity, Microsoft 365 management, backup and disaster recovery, vCIO services, project prioritization, business continuity planning, and multi-year technology roadmaps.
The objective isn’t simply to tell leadership what technology costs. It’s to make four things clearer:
What are we spending? Why are we spending it? What will we need next? When should we budget for it?
Is Your Law Firm Ready to Build Its 2027 IT Budget?
Start with one question:
Can someone show you every major technology expense your firm is likely to face during the next 12 months?
If the answer is no, your 2027 IT budget probably isn’t finished.
For a 20–30 employee law firm, technology spending should be planned, prioritized, and connected to business needs and risk—not discovered one invoice at a time.
Want help building a more predictable 2027 technology budget?
Schedule a 10-minute discovery call with Ferrari Networks. We can review your recurring IT costs, hardware lifecycle, cybersecurity priorities, upcoming projects, and the technology expenses your firm should be planning for.
Pricing examples in this article are provided for planning purposes and may change. Actual technology costs vary based on licensing, environment, security requirements, services, and business needs.
