I am writing my freelance agreement (per project) and I'm having trouble finding a good policy for invoices not reconciled more than 30 days.

Do you VAs have a policy I can follow by example?

Have any of you had previous issues with invoices not being reconciled by your clients? How did you handle the issue?

Any advice would be much appreciated!!

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Morgan Vas
Modern Assistance

Hi Morgan,

I work on a per project basis for 90% of my clients. My policy only allows for 10 days before they are considered late as I ask for 1/2 up front and the remainder once the project had been signed-off by the client. I feel they already know what is coming, and an approximation of when, so 10 days is more than enough time.
Here's my policy as it is on my contract (I also state this verbally when speaking to the client)

Quote:

In the event that the Client has an outstanding invoice for more than 10 days, the Consultant will cease all services and refuse all access to completed materials, this agreement will be placed “on hold” until the Client has paid the total amount owed plus all applicable interest fees. Interest will be charged DAILY (after the 10th of the month) at a rate of 1.5%.

In all the years I have been doing this I only had ONE client mention(rudely) that he thought it was a bit harsh. Keep in mind though, he was 3 months late paying me so he had a large fee added on. After his rude email, he paid the invoice IN FULL & went on his merry way.

Not 1 month later I found out he had hired a friend to maintain the site I built and that friend messed some things up. Apparently, my fees weren't so harsh because he came back to me to fix it all, paid 90% up front and paid my final invoice within 2 hours with a HUGE thank you attached.

FYI: this client received an email from me every day with a new invoice attached that showed him what it was costing him each day to ignore me. I had his signature on a contract so there wasn't much he could do at that point. Small claims court is a pain in the butt so most people will just pay the invoice rather than go through all that.

My motto: Never apologize for your policies, they are there to protect you and the client.

~C

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~Christina|BD Mag|VOSTeam

I like this concept it is straight to the point and I think most clients will be okay with it.

Thank you Christina! That's just what I needed to hear! I had a couple doubts with some policies in my agreement, but I think it will work out just fine. Thanks for sharing your experience with this, great advice!!

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Morgan Vas
Modern Assistance

In my own company, for per-project work we require 50% in advance with balance due on completion. For long term hourly clients I invoice every two weeks on net 14 for PayPal payments, net 7 for checks. In any case, late payment penalties are pretty steep - I charge a percentage of the invoice ongoing, weekly, until it's paid.

Like Christina, I send reminders with updated invoice totals reflecting the penalties (weekly though, it sounds like Christina bills daily for late payments).

I think a late payment policy is one of the most important parts of any contract. Iplementing those policies is crucial to running a successful business. There are clients who will look for ways around paying and drag it out if they can - always impose your late payment penalties right away, let them know it's been done, and don't feel bad about it. You're in business to make a profit, you're not a bank, you do not have to extend credit. Your phone company does not feel sorry for you if you pay your bill late. They tack on late fees and that is that.

That's how I look at it anyway.

Yes, there are circumstances when I've waived a fee for a client who's let me know she needs to pay a week late. As long as she follows through and it's not an ongoing thing, that's something I am willing to extend to a good, long term client.

I hope that helps!

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I plan on having a website, do you think that I should put up a blurb on my policies to let potential clients know how I operate?

Allora,

If you think it is important, you can place that on your website. Some VAs do this while others do not. I think it is important to place some policies on the website but some policies
can be discussed later when you get to know the client perhaps in a consultation or in the VA welcome packet.

Take a look at other VA websites so you can get a feel for what others are doing and then customize your site to your own needs and desires.

Janine

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Hi Janine,
Thanks so much for the advice. I have numerous sites bookmarked for reference. I had to create a whole new profile on my computer just for the wealth of information that I am digging up!

I have just implemented a late payment charge and I wrote up some Terms of Business which I send with each quote, so the client knows before they get started exactly what the deal is.

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Since all my payments are up front I rarely run into any problems but there are cases where an invoice is sent out - then they have 7 days to pay before they're considered late. Once they're late, they are charged a $10 late payment penalty and interest each month. Once they hit 30 days, they're turned over to a collection agency.

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