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3 min 28 sec
0:00
Actually getting paid
0:18
Paid in full
0:43
Part payments
1:00
Aged receivables
1:30
Chasing, politely
1:58
Reminders in Beeswax
2:44
Recap and quiz
Accounting 101
·
Getting paid
·
Episode 9
Getting Paid
(And what to do when you don't.)
One client pays in full, one pays part, and one goes quiet. Record payments, read an aged receivables list and chase overdue invoices without the awkwardness.
payments
part payments
aged receivables
overdue invoices
Transcript
0:00
Invoices out. Money owed. Now comes the part nobody teaches you at design school. Actually getting paid.
0:08
Some clients pay early. Some pay on time. And some clients treat your due date as a gentle suggestion.
0:18
Good news first. Twelve days after the invoice, Fern and Fold pay the four thousand in full.
0:24
Bank goes up four thousand. Trade debtors goes down four thousand. Debit bank, credit trade debtors.
0:31
And notice what doesn't change. Revenue. That was counted when she invoiced. The asset has just changed clothes. From an IOU, into actual money.
0:43
Next, the Corner Cafe pays a thousand of their twenty-two hundred. That's a part payment. Bank up a thousand, trade debtors down a thousand.
0:53
They still owe twelve hundred. The invoice stays open, marked part paid, until the rest turns up.
1:00
And then there's Harbour and Co. Their invoice was due a month ago. Nothing. Not even a sorry.
1:07
This is where an aged receivables list earns its keep. It sorts what you're owed by how late it is. Current. Up to thirty days. Thirty to sixty. Sixty to ninety. And the ninety plus club.
1:21
The older a debt gets, the less likely it is to be paid. So the right-hand columns are where you spend your energy. And, occasionally, your patience.
1:30
So, chasing. Nobody enjoys it. Do it anyway. Asking to be paid on the date you both agreed isn't rude. It's just the invoice, doing its job.
1:41
A friendly nudge a few days before the due date. A reminder on the day. Then a firmer note a week later. And, if you must, a final notice.
1:51
Be polite. Be consistent. Be a bit boring about it. Clients who know you'll chase tend to pay first.
1:58
In Beeswax, every invoice shows where it's up to. Sent. First notice. Second notice. Final notice. Each time you resend an overdue invoice, it steps up a level, so the history speaks for itself.
2:13
When money arrives, record the payment against the invoice. Pay part, and it's marked part paid, with the balance still showing. Pay the rest, and it's paid. Done.
2:24
And Who Owes Me keeps the whole picture in one place. Who's paid, who's part paid, and who's overdue. Handy, at midnight.
2:34
And if Harbour and Co never pay at all? That's a bad debt, and it has its own episode. For now, keep chasing. Politely. Relentlessly.
2:44
So. Getting paid swaps a receivable for cash. Revenue doesn't move. Part payments leave a balance. And the older a debt, the harder it is to collect.
2:55
Quick one. Maya invoices three thousand. The client pays eighteen hundred. What's the entry for the payment, and how much is still owed?
3:04
Have a think.
3:08
Debit bank, credit trade debtors, eighteen hundred. And twelve hundred still owed. Part paid. Keep chasing.
3:17
Politely. Relentlessly. You know the drill by now.
3:21
Next time: retainers. The magical words, every month. Recurring revenue, and how to keep it simple.