One of the biggest worries as someone who is self employed has to do with getting paid. When you are self-employed, you are essentially providing a service or a product up front, with no real surety that you will receive what you are entitled to. Indeed, even if the client pays regularly, that is no guarantee that he or she will continue to do so.

I had a client that paid me faithfully, on time, for almost year. And then, suddenly, disappeared owing me $2,000. Not a pleasant feeling. It was near the beginning of my freelance career, so I didn’t have a separate business account set up, and my record keeping was spotty at best, so I didn’t really have what I needed to go after the guy. I’ve learned a thing or two since then.

Get it in Writing and Keep Good Records

First of all, you need to get your agreement in writing, and keep good records. While you don’t necessarily need a contract for every job, you should ave some sort of explicit written communication about what will be done. My uncle the lawyer says that for most of my blogging clients, an email specifying the work to be done and the payment schedule, along with an email in return from the client explicitly accepting the terms, is sufficient.

I keep all of the agreements in a special email folder, and I back them up. It makes it easy and searchable in the event that I have a question. For other projects, a contract might be appropriate. Make sure you have a copy of it, dated and signed, kept in a safe place. That way, you will have the records to indicate that the client agreed to the terms.

Ask for Some of It Up Front or Set a Shorter Schedule

For larger projects, I ask for some of the payment up front. This provides some protection from doing the work and then having to fight for all of the payment. For work that I do regularly, I invoice on the 15th of each month, and on the last day of each month. That way, if I am not paid, I can simply stop doing the work until the payments are caught up.

Is It Worth it To Pursue the Matter?

One of the questions you have to ask yourself when someone doesn’t pay is whether or not it is worth it to pursue the matter. When one of my smaller clients owes me money, it’s not often worth it to pursue the matter. A few years ago, I had a client that owed me $40. I stopped work and sent three reminder invoices, but when I still didn’t get paid, I just moved on. The cost of trying to collect on that $40 would have been more than it was worth.

Do a little research on the attorney fees, or the process of turning over an account to collections in your state. You might be owed $2,000, but would it cost you $4,000 to collect it? Unless you want to make a point, you could be doing yourself a disservice by pursuing the case.

What tips do you have for getting paid?



Miranda is freelance journalist. She specializes in topics related to money, especially personal finance, small business, and investing. You can read more of my writing at Planting Money Seeds.