How long does it usually take to get paid by your clients? And more importantly, how many clients pay late — or worse — not at all? Ensuring on-time payments is a problem many freelancers struggle with. In the U.S., 54% of freelancers say it takes too long to get paid.
Another 45% state their clients don’t pay on time. And it’s not just an issue in America — in the U.K., 41% of freelancers are consistently paid late.
But it doesn’t have to be this way. As a full-time freelancer, you need to ensure money flow is predictable. Otherwise, you could end up falling behind on bills and falling into financial troubles.
This guide will show you how to improve the odds of getting paid on time (and what to do when all else fails). Let’s dive right in.
Vet Clients Before You Commit
A client sends you an email asking for your services. You’re excited to bring them on board and get started on their project. But don’t.
There’s homework to do in advance. Doing your due diligence could be the difference between working on a dream project or dealing with a nightmare client. Ideal clients are well-funded companies that treat freelancers like valued professionals.
Sometimes, you can learn about a business by looking on review sites, such as Glassdoor.com. This is where employees and freelancers go to leave feedback about the companies they’ve dealt with.
You can also look for other freelancers who’ve worked with the organization and ask them questions about their experience. LinkedIn is an excellent resource for finding folks who have or still work for your prospective clients.
Never Begin without a Contract
Once you’ve vetted the client, it’s time to get things down in writing. In doing so, you’ll reduce the odds of disputes regarding rates, due dates, and scope of work. It’s critical to lay a foundation for each project, so everyone’s on the same page before the project starts.
The purpose of a contract is to protect both parties. It’s a mutual agreement, and it showcases your professionalism as a freelancer. So it sets the right tone and gives a great first impression for new clientele.
But how do you go about creating a professional contract?
There’s no need to hire a lawyer and pay crazy cash to have a document drawn up. Instead, you can use a simple platform like AND.CO to create gorgeous (yet, professional) contracts. You can email the agreement to all parties to sign virtually and then convert it into an invoice at the click of a button.
Ask your clients about their accounting schedule, so you’re aware of their process. Some clients may want to pay their bills on a specific date each month. Consider this when creating your contract and payment terms.
Be Punctual with Your Due Dates
In other words, don’t give your clients a reason to slow down payment. It’s easy to get overzealous about your speed and capacity. So it’s not uncommon for freelancers to agree to short turnarounds and/or high output within a tight timeframe to win over a new client.
Don’t do this.
Placing yourself in a challenging position of getting work completed on time while maintaining quality will only hurt your output. Be sure to manage your time, so your efficiency doesn’t suffer.
Track how long it takes to complete projects so you can determine the best turnaround times to agree to. Then make sure to stick to it, so you don’t delay your payment.
Send Invoices Immediately Upon Completion (or Acceptance)
It’s simple — the sooner you send your invoice, the faster you’re likely to be paid. So don’t wait around after a project is completed. Once you’re done, you should submit your invoice for payment.
And since digital engagements are the norm between freelancers and clients, it makes to accept online payments. Not only does it offer convenience to your clients – but it also enables faster payment. With AND.CO, you can send invoices electronically and connect your checking, and online payment portal accounts for swift payments.
Set Up a Follow-Up Strategy (Automation is Key)
Sending an invoice doesn’t always lead to quick payment. Sometimes, clients get caught up in running a business and forget about pending projects. So to keep them on their toes, you should develop a strategy that consists of sending payment reminder emails.
For example, you can send an email after three days, then again after one week. From there, you should continue sending reminders every several days. It’s easier to maintain this strategy when you implement an automation tool. AND.CO streamlines this by allowing you to create automated payment reminders.
Make sure to set it up for each invoice you send, so you can focus on building your freelance business, not playing bill collector.
But when worse comes the worst, you may have to take it a step further. If your clients fail to take heed to your automated payment reminders, then it’s time to write a personalized overdue payment reminder letter.
Keep Money Flowing into Your Freelance Business
You became a freelancer because you wanted more freedom. This may be the freedom to work where you want. Freedom to choose the projects you work on. And/or the freedom to work how you want. But this is difficult to achieve when you’re burdened with managing your own marketing, management, and finances.
Although you get used to wearing multiple hats, no freelancer should have to deal with debt collection. It’s time-consuming and takes away from revenue-making tasks. So it’s vital to create a process that sets your business up for on-time payments.
Having the right tools in place is critical to streamlining this process. AND.CO is more than just an invoicing tool. It’s a freelancer’s assistant for prospecting, closing deals, and getting payment. It does this by simplifying the creation and distribution of professional proposals, contracts, and invoices.
If you’d like to see how it works, then sign up for free today!