Payment Situation...Crap

[CedarCreek]

I know, I shouldn't have let this happen. But someone help me, please!

One of my DCKs is a doll. Just very sweet, loving cute little boy. His parents are great. If it weren't for me not wanting to mix business with friendships, I might be friends with them. Mom even bought me something for Valentine's day.

Both parents are teachers. They get paid on the 15th and the 30th. They were having trouble paying in advance weekly and were very embarrassed to ask me if they could pay in advance on the 15th and the 30th. Not wanting to lose this good family, I said yes.

Big mistake.

They went out of town during the Christmas break. Which was fine but a payment date fell in the middle of that so I went unpaid until they got back and were very apologetic. Because of that and also because of the way the 15th and the 30th sometimes fall, they are now paying for the two weeks PRIOR instead of in advance. By April, they will be 3 weeks behind. I cannot let this happen.

I sent home a letter stating their correct balance and that I was willing to work with them to get them back on track. Mom texted be apologizing but I haven't heard anything since.

The problem is, can you think of any way payment on the 15th and 30th can work? The only way I can think of is that they will have to pay for the 2 weeks in advance plus additional days up to the next date of payment if that is in the middle of the week. Which I think could get very confusing.

Like I said, HELP!

[butterfly]

I don't know if this will make things any easier on you, but the way I do it on a family that wants to pay monthly or bimonthly. We count the number of MY pay days within that time frame. I get paid on Fridays so I have them count the number of fridays within that month and multiply by my weekly rate for their payment. I don't send out statments for balance due. My families have been good about keeping track and paying correctly.

[wdmmom]

I would suggest they pay 1.5 times their normal rate on the 15th of Feb and 1.5 times the rate again on the 30th. This should bring them current.

If they can't do it, suggest they pay $100 more each payday until paid in full...although I wouldn't let it go on for more than a couple weeks.

And, if they simply can't do it, suggest they borrow it from family or take out a cash advance on a credit card. You need to get paid too!

[Meyou]

52 weeks x weekly charge / 24 bimonthly payments = bimonthly payment rate.

The only way to make it work is for them to pay the extra days each pay. They are paying EXACTLY the same annually but are paying it in 24 payments instead of 52.

[CedarCreek]

52 weeks x weekly charge / 24 bimonthly payments = bimonthly payment rate.

The only way to make it work is for them to pay the extra days each pay. They are paying EXACTLY the same annually but are paying it in 24 payments instead of 52.

Liking this idea!

I have asked them to pay for an additional week with each payment until they can get caught up. That should only take a couple of payments.

I dont really see a way for them to pay on the 15th and 30th that isn't confusing as heck.

[laundrymom]

One question, and I mean no distespect why are you letting their inability to plan, affect your income?

I know you agreed to it but here's what I would do

Joy, the payment arrangment isn't working for me. I can only accept payment in advance from now on. You can still pay on your pay days, but in advance. My bills can't suffer because of your paydays.

[CedarCreek]

One question, and I mean no distespect why are you letting their inability to plan, affect your income?

I know you agreed to it but here's what I would do

Joy, the payment arrangment isn't working for me. I can only accept payment in advance from now on. You can still pay on your pay days, but in advance. My bills can't suffer because of your paydays.

Oh gosh, I know

I didn't even think about it being a problem when they first asked. I just said yes because they were paying in advance. But then the Christmas incident happened and then I actually looked at the calendar and realized that they were getting further behind because of the way the days were falling. That's why I sent the letter explaining their balance and offering to work it out.

I should have paid attention to what they were asking before I said yes.

[CedarCreek]

Oh and in the letter I also told them that we may need to work out a different payment arrangement unless they want to pay for 2 weeks in advance and extra days up to the date of the next payment.

[MarinaVanessa]

52 weeks x weekly charge / 24 bimonthly payments = bimonthly payment rate.

The only way to make it work is for them to pay the extra days each pay. They are paying EXACTLY the same annually but are paying it in 24 payments instead of 52.

The only problem with this, as another member once wrote about it on a thread, is that what happens if the client doesn't stay the entire year? Depending on when the client signs up or terminates during the year the client may end up getting over-charged and paying for extra days that they didn't get to use .

For example:

let's say that a client is already signed up and pays $150/week but bi-weekly in the way that you suggested and it's now the new year (2013) and the client needs to terminate care on March 1 (that's their last day).
52 weeks x $150 = $7,800 / 24 bimonthly payments = $325 per bimonthly payment.
If they had paid weekly they would have paid = $150 x 9 weeks = $1,350 and would have had 45 days of childcare.
If they paid bi-weekly they would have paid = $325 x 4.5 weeks = $1,462 and would have had the same number of childcare days. This way this client is paying an extra $112.50 compared to the weekly paying clients.

And again, lets say that a client signs up on March 4th 2013 (first day) and ends up having to terminate care on May 31 2013 (last day).
52 weeks x $150 = $7,800 / 24 bimonthly payments = $325 per bimonthly payment.
If they had paid weekly they would have paid = $150 x 13 weeks = $1,950 and would have had 65 days of childcare.
If they paid bi-weekly they would have paid = $325 x 6.5 weeks = $2,112.50 and would have had the same number of childcare days. This way this client is paying an extra $162.50 compared to the weekly paying clients.

See what I mean ... unfortunately this method of payment is only accurate if the client stays for exactly a year.

[CedarCreek]

That's true too. Gah! I wishshe would just go back to paying every other Monday

[Blackcat31]

I have a current DCF that has asked to pay on the 15th and the 30th and now wants to only pay on the 15th.

I just said "Sorry, but ALL daycare payments are due on Friday bi-weekly or weekly. Up to you." I left it at that.

If you make an arrangement for one family then what happens to the family that has a short paycheck or maybe didn't save enough from the last one to pay you and etc etc etc.... see how doing "special" comes back to bite you?

Like Laundrymom said their payment dates have NOTHING to do with you.

Even if they are cool enough to be friends with.

Maybe just type them up a short memo saying that payment arrangements need to be re-evaluated and fixed immediately.

[Country Kids]

The only problem with this, as another member once wrote about it on a thread, is that what happens if the client doesn't stay the entire year? Depending on when the client signs up or terminates during the year the client may end up getting over-charged and paying for extra days that they didn't get to use .

For example:

let's say that a client is already signed up and pays $150/week but bi-weekly in the way that you suggested and it's now the new year (2013) and the client needs to terminate care on March 1 (that's their last day).
52 weeks x $150 = $7,800 / 24 bimonthly payments = $325 per bimonthly payment.
If they had paid weekly they would have paid = $150 x 9 weeks = $1,350 and would have had 45 days of childcare.
If they paid bi-weekly they would have paid = $325 x 4.5 weeks = $1,462 and would have had the same number of childcare days. This way this client is paying an extra $112.50 compared to the weekly paying clients.

And again, lets say that a client signs up on March 4th 2013 (first day) and ends up having to terminate care on May 31 2013 (last day).
52 weeks x $150 = $7,800 / 24 bimonthly payments = $325 per bimonthly payment.
If they had paid weekly they would have paid = $150 x 13 weeks = $1,950 and would have had 65 days of childcare.
If they paid bi-weekly they would have paid = $325 x 6.5 weeks = $2,112.50 and would have had the same number of childcare days. This way this client is paying an extra $162.50 compared to the weekly paying clients.

See what I mean ... unfortunately this method of payment is only accurate if the client stays for exactly a year.

Something isn't working right with this. They would actually be paying 26 times during the year wouldn't they? If you are going to do bi-weekly a few months have 5 weeks so they would have to pay extra during those months.

Paying only 24 times shorts you an entire month of pay!

[MarinaVanessa]

I think that one way to make it easier for them is for you do create a payment schedule of their pay dates and how many daycare days they are using in that time frame. They MUST make payments to you by the payment due date meaning EVERY 15th an 30th NO MATTER what. If they go on vacation or you are closed on that day they give you a post dated check.

For example let's say you normally charge $150/week:
$150/5 days in a week = $30/day
Payment due: Jan 30 - covers 01/30-01/14, 10 days x $30 = $300
Payment due: Feb 15 - covers 02/15-02/27, 10 days x $30 = $300 (Feb only has 28 days)
Payment due: Feb 28 - covers 02/28-03/14, 11 days x $30 = $330
Payment due: March 15 - covers 03/15-03/29, 11 days x $30 = $330
etc.

[MarinaVanessa]

Something isn't working right with this. They would actually be paying 26 times during the year wouldn't they? If you are going to do bi-weekly a few months have 5 weeks so they would have to pay extra during those months.

Paying only 24 times shorts you an entire month of pay!

I'm not seeing this .... hmm. How are you getting 26 payment for a year? If a client pays on the 15th and 30th of each month and there is always only one 15th and one 30th in a month (except February that only has 28 days which means that the client will pay on the 28th instead of the 30th) doesn't that still make it only 2 payments per month meaning 24 payments per year? :confused:

EDIT: ooooh, I see what you are trying to say. Some months have 5 weeks. But in the math equation that MeYou proposed (52 weeks x weekly charge / 24 bimonthly payments = bimonthly payment rate) she includes all 52 weeks that we are paid, so she includes the months that have 5 weeks (3 pay periods). She just divides the yearly total of what we would earn and divides it by 24 payments (2 payments per month, the 15th and the 30th).

I'm confusing myself with all of this math ::.

See this is why I stay away from these types of payments . I charge weekly, in advance of care, on every Friday. If a client wants to make bi-weekly payments ... fine. But you pay me 2 weeks of childcare on FRIDAY and I'll carry the balance. Same goes for a month, or a whole year ... ok by me. But I WON'T chop up my payments based on when they get paid. No 15th & 30th payments for me.

[CedarCreek]

I think that one way to make it easier for them is for you do create a payment schedule of their pay dates and how many daycare days they are using in that time frame. They MUST make payments to you by the payment due date meaning EVERY 15th an 30th NO MATTER what. If they go on vacation or you are closed on that day they give you a post dated check.

For example let's say you normally charge $150/week:
$150/5 days in a week = $30/day
Payment due: Jan 30 - covers 01/30-01/14, 10 days x $30 = $300
Payment due: Feb 15 - covers 02/15-02/27, 10 days x $30 = $300 (Feb only has 28 days)
Payment due: Feb 28 - covers 02/28-03/14, 11 days x $30 = $330
Payment due: March 15 - covers 03/15-03/29, 11 days x $30 = $330
etc.

Oooo, this is good. I think I will suggest this to her if she wants to stick with this current plan. Thank you!

Secretly hoping for bi weekly payments though. Lol