The nation's lawyers, hoping to follow the lead of two big Boston firms, are taking a close look at expanding into financial services.

Some law firms consider the investment advisory business a natural extension of services they already offer, such as administering trusts. Many others, especially those lawyers who specialize in estate planning, are looking for new ways to generate revenue. Because of more liberal estate tax rules, fewer consumers need lawyers to devise complicated wills and trusts."It's simple," says Christiane Delessert, a vice president with Seidman Financial Services in Boston. "It's happening because (financial services) are a lucrative business. Lawyers can make money."

The legal profession is closely watching Hale & Dorr and Nutter, McClennen & Fish, two Boston law firms that recently spun off their trust departments and registered the new units with the Securities and Exchange Commission. They are the first two law firms in the United States "to enter the investment business," says Massachusetts Lawyer Weekly, a trade publication.

Lawyers' groups, including the American Bar Association, are also studying ways lawyers can market themselves as financial planners. Some lawyers, in fact, already offer financial planning services. For example: a large Tampa, Fla., law firm operates a business that scrutinizes its clients' life insurance needs and negotiates with agents for the lowest price; other attorneys have even opened financial planning practices.

To be sure, the lawyers' task won't be easy. Accounting firms, such as Price Waterhouse and BDO Seidman, the parent of Seidman Financial, are already in the financial planning business and serve many of the same affluent clients the law firms hope to attract. In addition, they face stiff competition from banks and a horde of independent money managers and financial planners, many of whom have set up shop in the past five years.

Still, lawyers are banking on striking gold in financial services by targeting affluent consumers who might feel more comfortable discussing their money matters with a law firm. "We just didn't hang a shingle out down the street," says John K.P. Stone III, chairman of the executive committee at Nutter McClennen. "We've been here for 100 years."

Managing money for clients isn't new in such cities as Boston and Philadelphia, where law firms traditionally offer certain financial services as part of their legal business. (Boston firms manage assets of around $3 billion, estimates the Massachusetts Lawyers Weekly.) For instance, a client who just sold a business might want the law firm to administer a trust that would provide for his children's education. And as long as the financial management services stem from the law firm's legal work, the lawyers aren't required to register with the SEC and, thus, disclose the finances of all its partners.

What has changed is that law firms are looking for customers outside their law practice.

Why? Business is off, for one thing. One culprit is changing federal tax rules, which raised the ceiling on how much parents could pass onto their heirs. "For a family to have any kind of estate tax problem now (on a federal basis) they have to have at least $600,000 instead of $60,000," says J. Thomas Eubank, a Houston lawyer and former president of the American College of Probate Counsel.

But lawyers also figure that financial services are a good way to diversify.

Hale & Dorr spun off its trust department earlier this year and registered Haldor Investment Advisors with the SEC. "We had several approaches from pension (funds) and individuals for whom we weren't acting as lawyers," says John Hamilton Jr., the downtown Boston firm's managing partner. Nutter McClennen, meanwhile, launched Nutter Investment Advisors in August and is awaiting SEC approval.

Unlike many other law firms with trust departments, Hale & Dorr and Nutter McClennen already had full-time portfolio analysts on staff who pick certain stocks, bonds and mutual funds and bonds for their clients. For example, Hale & Dorr employs five portfolio analysts, none of whom are lawyers. Trust departments at law firms typically hire outside investment concerns to make such recommendations.

The firms' services aren't for the ordinary investor, however. At Nutter Investment, stakes typically range from $250,000 to $10 million. "We'll go as low as $100,000 if there is a prospect of it increasing," says Stone. Moreover, the fees can be hefty: the firms charge clients a percentage of their assets and a percentage of the income the portfolio generates.

Other attorneys say that financial planning business is another good way to expand their practices.

But the task of the financial planner is often more complicated than the money manager, who picks and supervises investments. Planners, in addition to choosing certain types of investments for their customers, also analyze their clients' spending habits, construct budgets, and devise complicated retirement plans.

Thus, the financial planning business is somewhat of a mystery to lawyers who don't know how to market such services, don't know what to call themselves and, for the most part, don't have the broad-based background to become financial planners. To figure it out, the ABA two years ago launched its task force as did the ACPC, the Los Angeles-based probate lawyers' group. "We're in a rapidly evolving speciality here but we're not sure which way it ought to go and how far it ought to go," says Eubank, the Houston lawyer.