A big struggle of being self-employed is maintaining a good cash flow. You do a lot of work for clients, but it could be weeks or months before the money comes in. You send out an invoice and it gets lost in the swill of emails they receive every day. Time passes and you desperately need the money to survive.
Finding ways to secure faster invoice payments is crucial – and you’re about to learn how. Keep on reading to discover some of the best ways to do this.
Offer multiple payment methods
One common mistake is sending an invoice with only one payment method attached. Typically, you’ll leave your bank details and expect the client to send a bank transfer over. This is quite an arduous task and it’s an easy thing for them to set aside and forget about.
Instead, you should be looking for credit card merchants services to set up multiple payment methods. When an invoice is sent out, instead of only getting one option, they can click a button and pay instantly via credit or debit cards. You’re making the payment process more fluid and easier for the client, which can encourage faster payments every time.
Ask for money before the work
Self-employed individuals have gotten into the habit of requesting payment after completing work. It makes sense, but think about how other businesses operate. If you pay a business for a service, you tend to pay upfront and then receive the service. Why should it be any different for a self-employed worker?
Start asking for money upfront, so you’ve got the cash in your bank before the job begins. You’ll negate cash flow problems, making it easier to run your own little business. Or, you can ask for a percentage of the final fee as a deposit. It gives you some money, and when combined with the other tactics we’re talking about, should still enable faster payments.
Invoice as soon as the job is done
If you can’t get money upfront for whatever reason, the next best option is to invoice as soon as the job is done. When you send off the final project to a client, attach your invoice in the same email. We moan about clients being late with payments all the time, but sometimes it’s not their fault. If you wait a few days/weeks to send an invoice, you can’t complain that it’s late.
Get into the habit of making invoices in advance and then sending them the moment a job is over. You’re more likely to see instant payments like this as you’re fresh in the client’s mind and they don’t have any excuse to neglect the invoice.
Try any or all of these tips and you’ll notice faster invoice payments from all of your clients. Also, while you’re creating invoices, make sure there are clear payment terms. Outline in the invoice when the money should be paid and what happens if it doesn’t get paid by that date. If clients see that you charge extra fees for late payments, they’ll definitely pay on time.
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