Not getting paid for work performed is a big problem for freelancers.
Your clients don’t always pay you on time, or worse yet, they may never pay at all!
Not getting paid for work performed is a big problem for freelancers.
This can be frustrating because it’s hard to get new clients if your old ones aren’t paying.
Even worse, not getting paid can lead to financial problems for you in the future.
You can’t pay your bills and build your business if you are working for free.
There are a few different tools and tactics that freelancers can use to collect unpaid invoices and get paid faster.
Here are four ways that we recommend using today to collect past due invoices from your clients!
Always Send Your Invoices On Time
While when you send your invoices can vary from client to client, be sure to always send your request for payment on time.
Some clients might require you send your invoices right when your work is complete while others might require you to send invoices on certain days of the month or week.
One way to always be sure that you are able to send your invoices on time is to use invoicing software.
Track Your Invoices with a Invoicing Software
There are many different invoicing software available for freelancers on the market today.
While many new freelancers invoice their clients using PayPal, there are many other options that offer a lot more flexibility and features.
Invoicing software allows you to keep your records organized and easily accessible for future reference. This way you can easily find information about customers who owe you money for invoices, including contact details, outstanding balances, and payment history.
Some of the most common and easy to use freelancer invoicing softwares include:
Most of these invoicing softwares can be used right on your computer or through an app on your smartphone.
Using these systems as apps is great because you can set up push notifications and reminders for yourself right in the app.
Create a System for Following Up with Clients When They Don’t Pay
No matter what type of freelancing you are doing, you need to have a system in place to follow up with your clients who don’t pay their invoices on time.
This could be a simple reminder that you put into your calendar or within your project management system or invoicing software.
With Freshbooks you are able to set up automatic reminders if clients don’t pay their invoices on time.
You should have it included in your contract, your process for past due invoices and the process you will take.
Send a Past Due Email Reminder
When you are originally onboarding your clients, be sure that you have all of their correct contact information, including email, phone number to call or text, and potentially a backup email or form of contact.
This will ensure that you have the right contact information when you are trying to invoice your clients.
Within your original contract with your client, you should include the parameters for payments. This should include when invoices are expected to be paid (ex: within 48 hours of receipt), when you will send reminders, when late fees are incurred and how much, when you will make phone calls to them about unpaid invoices, and even necessary legal actions for unpaid invoices.
If they don’t pay within the required time nor respond to you, then send them another email asking about their plans to pay and include proof of work along with your invoice.
Past Due Invoice Template
Email subject: Invoice [#] is [this long] overdue
Message:
Hi [client],
Our records indicate that we haven’t yet received payment of [$amount] for Invoice [#], which is overdue by [this long]. I would greatly appreciate it if you could check this out on your end.
Please disregard this notice if the payment has already been sent. If this invoice has been lost, please let me know, and we’ll gladly send you another copy.
Thanks,
[signature]
Followup Email Template
If the first email regarding the late payment didn’t work and you are still waiting on your payment, then try a followup email a week or so later.
Email subject: Invoice [#] is [this long] overdue
Message:
Hi [client],
I have written you several times regarding the pending amount of [$] for invoice [#]. As another reminder, this payment is now [this long] overdue.
If you have any queries regarding this payment, please let me know. I’ve also attached a copy of the invoice to this email, in case the original was lost or deleted.
Could you reply to this message and let me know you’ve received it and when you are planning on making the payment? Thank you.
Regards,
[signature]
Follow Up With the Customer by Phone or In-Person
If you aren’t having any luck with emailing them, then try and reach out to them via phone or visit their company in person, if possible.
Yes, calling a customer to ask them to pay you can be scary, but it can also be necessary.
They might need a phone call rather than an email reminder as they might not look at their emails often or your communications might be getting lost in their email.
If necessary, leave them a message asking them politely to call you back about their overdue invoice.
If you are able to get ahold of your client, politely ask them if they receive the invoice. If they have, ask them when they are planning on paying the invoice.
Here is a quick template when talking to your client over the phone:
Hi [client],
How are you today?
I just wanted to give you a quick call about the invoice for the [services] that I completed on [date].
I know that you’re busy and I respect your time. I would greatly appreciate it if you could just give me an idea on when you are planning on submitting that payment.
Thank you so much for your time and I appreciate your business.
Have a great day.
Payment Receipt Template
Once you have received the payment, you should send the client a payment receipt for their records and yours. This might also help with any future issues of late payments.
This can be a simple, branded page with a table that includes the services offered and amount charged for those services.
You can find free payment receipt templates on template.net or many of the invoicing softwares, such as Freshbooks, allow you to create a payment receipt once the client has paid the overdue invoice.
Hire a Collection Agency
As a freelancer, you need to focus on your work, not spend all of your time chasing your clients around begging them to pay you.
If you have reached out to your client several times without any luck at getting your payment, then it might be time to hire a collection agency.
Before you reach out to a collection agency to get overdue invoices taken care of, you should make your client aware that you are going to be using a collection agency to collect the payment with one last email reminder.
Oftentimes, the threat of being taken to collections is enough to make them cough up your money. They don’t want to get their business credit dinged, so it’s better for them (and for you) to just pay up and avoid lawyers and collections all together.
Hiring a collection agency is best if you have exhausted all other methods.
Collections can be invasive with the collection agency contacting the debtor via phone and or sending formal demand letters.
Just be aware that working with a collection agency, they will take a cut of your payment, they got to get paid too!
Collection Letter Template
Dear [Client name],
[This long] has now passed since my last invoice was sent, therefore payment for the work I performed is now ____ days past due.
I’d like to revisit our previously agreed-upon terms to ensure proper payment for the completed services.
I have attached copies of our contract, and emails referring to these terms, for your review. The agreed upon terms are as follows:
- [The services both parties agreed to perform]
- [The due dates of the deliverables]
- [The payment schedule, if applicable]
- [Pay [$____ for every month payment is past due.
The total amount now due is $____.]
As per these terms, I…
- [The completed these deliverables and delivery due date]
On [date here] you acknowledged receipt of these deliverables by…
- [what your client did to acknowledge receipt of deliverables]
Should I not receive the payment within ____ days, I will have to take the following steps…
- [Deny access to the deliverable, (if possible)]
- [File a claim in small claims court]
- [File a report with the Better Business Bureau]
Please let me know immediately if payment was recently made.
I have CC’d my attorney on this communication and have included their contact information if you have any further questions.
Thank you for your prompt reply,
[signature]
We hope these four tactics will help you collect your past due invoices from clients and make sure you get paid on time.
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