When Should You Start Worrying About Getting Paid?

A check was due two days ago, but the client’s really nice and has never been late before….

The invoice is due in three days and you haven’t heard from the client since it went out….

You can’t bill the client until they sign off on the last round of revisions but no one will respond to your emails…

…when should you start worrying about getting paid?

Friend, I know you mean well, but now is not the time to start worrying about getting paid.

By Doran via Flickr.com

By Doran via Flickr.com

The time to start worrying was a long, long time ago and you missed it.

Now you’ll have to just make do with anxiously refreshing your PayPal account and gnawing on your fingernails.

The time to worry was yesterday.

I jest about the nail biting. Sort of.

If you want to get paid, you need to plan to get paid.

While I believe that people should want to pay you out of the goodness of their fair and moral souls, that’s not always how the world works. Sometimes people are jerks. Sometimes people try to get away with things they’d be embarrassed to tell their mothers about.

If you’re interviewing clients before you agree to take them on and paying attention to red flags, chances are you will deal with fewer jerks for clients. But there are always a few that slip in, and it’s much easier to prepare yourself in advance to deal with them than it is to try and figure out what the heck to do after the fact.

It’s also not uncommon for perfectly nice and good clients to slip up now and again, particularly if the person you work with and the person paying you are two different people.

There are several different times during the client relationship when you can influence whether someone will pay you on time. If you’re only influencing your clients’ behavior after an invoice has gone out, you’ve missed out on a great number of opportunities to show your clients why paying you on time and in full is the very best of ideas.

Remember: a clear message consistently delivered is far more powerful than a rushed demand lobbed in a panic.

By Franco Folini via Flickr.com

By Franco Folini via Flickr.com

Build a good Payment Toolkit.

There are six basic types of tools you can use to get paid:

1. Policies & procedures.

2. Payment structures.

3. Contract language.

4. Invoice language.

5. Follow-up Communication.

6. Collections.

That may seem like an intimidating list, but chances are you already have a couple of tools in each of these areas right now. You might already get paid based on project milestones (#2) and have language in your contract about late fees (#3). You may even require a 50% deposit before work starts (#1).

If you do any of those things: congratulations! You’re out ahead of the problem and have given yourself helpful tools you can use if payment becomes a problem. But don’t stop there.

Are the last words on your invoice “thank you”? (#4) If not, give it a shot. Doing so has been shown to increase on time payment by 5%.

Do you have a template email that goes out as soon as invoices are late? (#5) Draft one today. It will not only save you from having to draft a personal email every time a client is tardy, it will train your clients to pay on time. Prompt communication tells your clients that you’re on top of things and that you’ll notice if you aren’t paid on time.

Most importantly: make sure all of your tools are sending the same message.

If you have a company policy that you’ll stop working if an invoice is more than 45 days late, make sure that’s reflected in all of your tools. In addition to being spelled out in a policy your client can read and review, it should show up in your contracts (even if you’re signing their contract!) and be mentioned on your invoices as well as follow-up communications.

When you worry about getting paid before there is a problem, you stockpile handy tools for Future You to whip out if the need ever arises. It means that when you do have a problem getting paid, you can spend your energy doing things that will help, instead of wasting it trying to figure out how to respond.

But what if you need to get paid now?

If you’re currently dealing with a non-payment or slow payment situation, the very best thing you can do is to confront the situation.

Talk to your client. Remind them of their responsibility. Work with them to set up a payment plan if necessary.

Even though it can be nerve wracking to do that, avoiding the problem and hoping it fixes itself almost never works. It often makes it worse.

If you’re having trouble figuring out what to say or how to approach the issue, I highly recommend the blogs over at Zen Cash and Fresh Books. They both have a great deal of helpful, practical information on talking with your clients about payment and dealing with the frustration of non-payment.

 

By Steve Rhode via Flickr.com

By Steve Rhode via Flickr.com

Want to learn more about building your payment toolkit? My first online class, The Ace Freelancer’s Guide to Getting Paid, debuts in October. I’m limiting the class to a cozy 20 students, which means it will be a hands-on experience with plenty of personal interaction between me and each of you. People on my class mailing list will get first dibs on those slots, so if you aren’t already on the list,  sign up today!

I’ll be releasing a self-guided e-course that teaches you how to draft invoices your clients will want to pay in October, 2016. If you haven’t already, you can join my mailing list to be notified when the course is released.

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One response to “When Should You Start Worrying About Getting Paid?”

  1. I think most freelancers in the early days take a much relaxed approach to getting paid. It’s important to have the right policies and systems in place. Freelancers must be very strict with your payment terms because cash-flow is the life-blood of any business.

    It’s also important to have a good invoicing application like Integrity Invoice ( http://www.integrityinvoice.com ) to create and send a professional looking invoice, send reminders and get paid via an integrated payment gateway to make it easy for your clients to pay you.

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