To find out if you’re overpaying for your money, look at how you invoice clients and accept payments.
Can you find ways to do it cheaper?
For many of you, the answer will be yes.
Start with how you bill clients. If you’re paying double-digit monthly fees for accounting software, ask yourself why. Is it because the software is trendy or brand name? Is it because you’re impressed with all the bells and whistles? Or, is it because you really need it and the features it offers?
Is it because the software is trendy or brand name? Is it because you’re impressed with all the bells and whistles? Or, is it because you really need it and the features it offers?
If your reason is the latter, and you really need accounting software, consider whether there are free or cheaper services that will work just as well for you. Even if you switch from a product that’s $19.99 to one that’s $9.99, you’ll be saving $120 a year.
I have never needed those services. I bill clients one of two ways. I either email invoices created from templates that I’ve saved on my computer, which is a free option. Or, when necessary, I use Paypal invoicing, which deducts a fee when the invoices are paid.
You might also be over-paying to accept payments.
Say you have clients who are paying invoices with a credit card. And say your invoices are $4,000 a month. If the service you use charges 3.5% of credit card transactions, you’ll be paying $1,680 a year in fees. But if you found a service to process those transactions for 2.5%, that 1% difference in fees would save you $480 dollars.
Or maybe, you could have that whole $1,680 in your pocket, if you changed how you get paid.
A lot of clients offer to pay various ways. A lot of freelancers choose the fastest and most convenient.
Not me. I’m a fee-o-phobic person. I prefer to have all of my money. That’s why I still have several long-term clients that pay me by check.
Going to the bank isn’t the trendiest thing to do. But in many cases, it’ makes the most money sense.
What about the gas and time getting there, you ask. If going to the bank is extremely inconvenient and expensive, you can always mail your checks. Or you could open an account at a bank that’s easier to get to. For me, it’s not a problem.
Another option that’s often free is accepting bank transfers. Sure, sometimes it can take 3 business days for the money to clear, but I can wait.
It’s satisfying to get your money in hand as soon as possible. Just having it in your possession, whether or not you need it at that moment, is satisfying. I understand.
But is that satisfaction worth paying for? That’s the bigger question. For me, the answer is NOPE.
Whether it’s billing or receiving, chances are, that reviewing your system will reveal ways you can get more of the money you earn.
This Money Bite is brought to you in Honor of Money Making May. Check back all month or use the RSS for more tips to save and make money.