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Get Paid on Time: 10 Essential Tips for Freelancers

<p>Let&#39;s be honest, there&#39;s one thing that universally sucks for freelancers: <strong>cash flow management</strong>. Will the freelancer who never got a late payment please stand up? Slow-paying clients are a generalized pain; they have the magic touch to turn any technically interesting project into a source of anxiety (For more clients from hell, visit <a href="http://clientsfromhell.net/">http://clientsfromhell.net/</a>). The situation can quickly become uncomfortable, juggling between not wanting to jeopardize the business relationship and the imperative of your basic expenses. Don&#39;t panic, here are 10 tips that will help you get paid in time.</p> <h2>1.Bill early, bill often.</h2> <p>Don&#39;t wait until the end of the month to bill a client, send an invoice as soon as you deliver something meaningful. The amounts will be lower and simpler to understand, and your clients won&#39;t feel like they&#39;re being screwed over through big numbers. They will be more inclined to pay as they look at the results (assuming you deliver good results!).</p> <h2>2. Set a payment due date</h2> <p>Most clients mean well but simply don&#39;t know about your ideal payment preferences. The usual is 30 days, but if none is specified, you cannot blame your client for the delays. Make sure it&#39;s clear as soon as you start the business relationship. Your invoice should display a due date and you should also repeat it in your email. It will be harder for your clients to say they didn&#39;t know, and you will have the perfect entry point for discussions about late payments.</p> <h2>3. Be firm, and consistent.</h2> <p>So, it&#39;s been 30 days and your client still hasn&#39;t paid up? Show him how serious you are about billing. On the 31st day, send a friendly reminder. Then, every subsequent 14 days, send them gradually less friendly reminders. They expect you to fulfill your end of the contract, it goes both ways.</p> <h2>4. Offer a discount on anticipated payments.</h2> <p>Financial incentives work with some clients. Try giving a 2% discount to clients who pay within 10 days. Mention it on your invoice and in your email.</p> <h2>5. Charge interest</h2> <p>Financial deterrents work with some clients. Let&#39;s admit it, nobody really likes this method, but it&#39;s legal and should raise the priority of your invoices. You have to make it clear at the very beginning of the relationship, though, and it should be written clearly on your invoices. Between 1% and 5% is common practice.</p> <h2>6. Get an upfront payment before you start</h2> <p>For longer projects with clients who trust you, ask for an upfront payment before you start working, and bill the remaining parts as you deliver.</p> <h2>7. Allow online payments.</h2> <p>They are faster, more efficient and require fewer interventions. By linking your Paypal or Stripe account on Momenteo, your clients will be able to pay you online with their credit card, the moment they receive the invoice.</p> <h2>8. Sell prepaid hour bundles</h2> <p>If you bill hourly, you can sell prepaid hour bundles to your clients. Every time you complete work, let your client know about the remaining hours. Offer discount on these packages, since they ensure predictability.</p> <h2>9. Stop working when some payments are late</h2> <p>If your client isn&#39;t paying up, stop working. Politely inform them that you&#39;re waiting for a payment to resume work. Your work deserves to be paid, so don&#39;t let this turn into a horror story.</p> <h2>10. Take legal actions</h2> <p>Hopefully, following the previous advice will help you never get to that point, but if an invoice hasn&rsquo;t been resolved in 90 days, you should start considering legal options. It will be much easier if you have a contract, or at least some sort of documentation (which we&rsquo;ll go through in a future post).</p><p> <img alt="craft" class="aligncenter size-full" src="https://blogmanagement.momenteo.com/Content/blog-img/craft.png" /></p><p> Happy billing! Got any tips? Share them in the comments!</p>

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Philip Barclay CMO@Momenteo