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Daycare Center and Family Home Forum>Deposits??
kpa0627 04:45 AM 04-29-2010
I'm thinking about implementing a deposit for when a parent signs their child up for care. What is it used for exactly though. Do you charge a deposit equal to two weeks of care and then keep it? Do you use that as their last two weeks of payment if/when they give their 2 weeks notice to leave? Do you use it to pay for curriculum? I'm just confused as to what the deposit is actually for and how much I should charge. My going rate is $135 a week for infants and $120 for 18mo-5yrs.
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tymaboy 05:14 AM 04-29-2010
I have both a Holding fee (if I need to hold a spot for more then 2 weeks) & a Registration fee (refunded if they give 2 week notice & no outstanding fees) I do not charge a full week for either but enough that they will want it back, I do it this way so it helps weed out the problem familys.
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emosks 07:59 AM 04-29-2010
We make them pay a deposit of one contracted week. It is put away into a savings account until it's their last week.
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MarinaVanessa 08:55 AM 04-29-2010
Originally Posted by kpa0627:
What is it used for exactly though... Do you use that as their last two weeks of payment if/when they give their 2 weeks notice to leave?
That's pretty much what a deposit is used for. The typical childcare deposit is the equivalent to two-week's worth of care and is usually given all at once before starting care. (I however do it a little differently if they don't have it all at once. I let them pay 1/3 of it up front along with their 1st week of care and split up the rest into weekly payments).

The deposit is used just in case they decide to leave and get backed up in their payments. If they give you a two-weeks notice and they owe you money you take it out of the deposit. If there is still part of the deposit left you put that amount towards the last two-weeks of care and they pay the rest of the last two weeks, if there isn't anything left of the deposit then they still owe you whatever it doesn't cover in debt and for the last two weeks of care. If they give you a proper two-week notice and they do not owe you anything then you use the deposit to pay for the last two-weeks of care (even if they don't show up).

If they don't give you a two-weeks notice and they just leave, they forfeit the deposit and you can keep it and they still owe you any money that is due to you including any fees for the last two-weeks.

I also wouldn't spend the money and put it in a seperate account just in case someone leaves. Remember that the money isn't really yours yet until they do leave. Of course you could spend it if you wanted to but if a family leaves and you spend the deposits you won't have anything to substantiate that income.

Just make sure that you say this very clearly in your contract otherwise none if this is binding.
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misol 11:51 AM 04-29-2010
Originally Posted by MarinaVanessa:
That's pretty much what a deposit is used for. The typical childcare deposit is the equivalent to two-week's worth of care and is usually given all at once before starting care. (I however do it a little differently if they don't have it all at once. I let them pay 1/3 of it up front along with their 1st week of care and split up the rest into weekly payments).

The deposit is used just in case they decide to leave and get backed up in their payments. If they give you a two-weeks notice and they owe you money you take it out of the deposit. If there is still part of the deposit left you put that amount towards the last two-weeks of care and they pay the rest of the last two weeks, if there isn't anything left of the deposit then they still owe you whatever it doesn't cover in debt and for the last two weeks of care. If they give you a proper two-week notice and they do not owe you anything then you use the deposit to pay for the last two-weeks of care (even if they don't show up).

If they don't give you a two-weeks notice and they just leave, they forfeit the deposit and you can keep it and they still owe you any money that is due to you including any fees for the last two-weeks.

I also wouldn't spend the money and put it in a seperate account just in case someone leaves. Remember that the money isn't really yours yet until they do leave. Of course you could spend it if you wanted to but if a family leaves and you spend the deposits you won't have anything to substantiate that income.

Just make sure that you say this very clearly in your contract otherwise none if this is binding.
This is exactly what I do. I require a 2 week deposit that will be credited toward the last 2 weeks of care as long as proper notice is given.
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