Monthly Payments

[Msdunny]

Those of you that allow monthly payments for a discount - how much of a discount do you offer? I am playing with the idea, although I do like that weekly income. I have invoices sent out automatically through the Square app, so it isn't a headache for me to collect, but it may be easier for some families to pay one a month.

Thanks in advance for the input!

[PB&J]

$10/child/month.

[Meeko]

Why discount?

I give parents the option to pay weekly, bi-weekly or monthly.

They get to choose what payment schedule works best for them, but they don't get to keep some of my hard earned pay too!

[Cat Herder]

I would not discount. I personally don't want to bill monthly as each month would be a different total and would open me back up to the "what do I owe?", "when do I owe?" and "why do I owe that?" discussions, again.

[Msdunny]

Originally Posted by Meeko

Why discount?

I give parents the option to pay weekly, bi-weekly or monthly.

They get to choose what payment schedule works best for them, but they don't get to keep some of my hard earned pay too!

I don’t necessarily want to discount, but I knew that some providers do and was wondering why and how much.

[Blackcat31]

I honestly don't know any providers anymore that discount for anything.

I think both providers and parents have realized there really isn't any valid reason to discount anything as those things parents view as warranting a discount (siblings for example) are actually more work than less work therefor no discount should apply. Atleast not fairly.

[Msdunny]

Originally Posted by Blackcat31

I honestly don't know any providers anymore that discount for anything.

I think both providers and parents have realized there really isn't any valid reason to discount anything as those things parents view as warranting a discount (siblings for example) are actually more work than less work therefor no discount should apply. Atleast not fairly.

This was my original thought, but I thought I had read that folks discounted for monthly payments. I was curious as to their reasoning and if it would be worth it. I’m not having trouble with weekly Billings, but thought i might offer monthly you parents who might like it for budgeting. I’m rethinking that now, and probably won’t make the change. Thanks all!

[Tin Blues]

Half of my parents prepay monthly and I don’t offer any discount.

[rosieteddy]

Never offered a discount.All parents ended up pre paying for the month .We counted Thursdays.It would be 4 or 5 weeks tuition due.I posted the number of weeks owed at beginning of the last week of month.

[AmyKidsCo]

I discount a little because I'd rather deal with 12 invoices/receipts per year instead of 49. Less chance I'll mess up.

My discount is about $50 for the whole year.

[laundrymom]

I offer a discount if they pay on time. kind of.
Like.
Say my base rate is $500 a week. It’s not. Lol. But just play along.
If they pay on time, by noon on Friday I only charge $500. If they pay after noon But before 5 pm. I charge $550.
So they only pay the base rate when they follow the agreed to terms so in a way that’s a discount. Right?

[Blackcat31]

Originally Posted by laundrymom

I offer a discount if they pay on time. kind of.
Like.
Say my base rate is $500 a week. It’s not. Lol. But just play along.
If they pay on time, by noon on Friday I only charge $500. If they pay after noon But before 5 pm. I charge $550.
So they only pay the base rate when they follow the agreed to terms so in a way that’s a discount. Right?

...off topic here... but Hi! Nice to see you back on the board!

[Msdunny]

Originally Posted by laundrymom

I offer a discount if they pay on time. kind of.
Like.
Say my base rate is $500 a week. It’s not. Lol. But just play along.
If they pay on time, by noon on Friday I only charge $500. If they pay after noon But before 5 pm. I charge $550.
So they only pay the base rate when they follow the agreed to terms so in a way that’s a discount. Right?

Love this! Perfect!

I think I’ve decided to not try to fix something that isn’t broken. My parents pay weekly, and on time because they are automatically invoiced and have set up about payments. And I like getting paid what I’m worth, so no discounts for care! Thanks for helping me think this through!

[Former Teacher]

My former center had a discount. Granted we didn't have "contracts" but parent's couldn't flip/flop.

If they paid weekly, they had to pay by Friday. If they paid monthly (it was due by the 1st), it was discounted PLUS they were done for the month. Which basically meant if there was 5 weeks in the month, they didn't have to pay for that extra week. Whereas if they were paying weekly, they had to.

[AmyKidsCo]

Originally Posted by Former Teacher

My former center had a discount. Granted we didn't have "contracts" but parent's couldn't flip/flop.

If they paid weekly, they had to pay by Friday. If they paid monthly (it was due by the 1st), it was discounted PLUS they were done for the month. Which basically meant if there was 5 weeks in the month, they didn't have to pay for that extra week. Whereas if they were paying weekly, they had to.

Yikes! Did the center just lose that week of payment? That would be a lot to give up! My monthly rate is 1/12 the annual weekly total so it's always the same regardless of how many weeks in a month, and I'm only out the discount I give for paying monthly.

BTW, I have some parents who pay 4 or 5 weeks at once to cover the whole month, but they don't get the discount because they're still paying "weekly" - same with the parents who pay 2 weeks' worth every other week.

Originally Posted by Cat Herder

I personally don't want to bill monthly as each month would be a different total and would open me back up to the "what do I owe?", "when do I owe?" and "why do I owe that?" discussions, again.

annual payment/12= equal monthly payment and don't matter how many days/week each month has.

Originally Posted by AmyKidsCo

Yikes! Did the center just lose that week of payment? That would be a lot to give up!

they don't lose anything. Just calculate a monthly payment as an annual payment/12. It makes the billing process much-much easier.

[Blackcat31]

Originally Posted by Unregistered

annual payment/12= equal monthly payment and don't matter how many days/week each month has.

As a provider it's easy to understand but I think what Cat Herder is trying to say is parents don't understand the math when terms like "monthly" are used verses "weekly" in regards to tuition.

Most providers get it. It's usually the parents that need to do the math or have it broken down for them.

Originally Posted by Unregistered

they don't lose anything. Just calculate a monthly payment as an annual payment/12. It makes the billing process much-much easier.

The center does lose a week's pay.....Amy'sKids was quoting a poster that specifically said her center lost a weeks worth of fees ....because they didn't calculate it by the week and instead did the math per month.

Poster said "Which basically meant if there was 5 weeks in the month, they didn't have to pay for that extra week."

[Cat Herder]

Originally Posted by Unregistered

annual payment/12= equal monthly payment and don't matter how many days/week each month has.

I second what BC said.

I also have 25 paid days off annually spread out that the parents are "discounted" for. I am still paid in full for all my closures, but the parents pay less on those weeks to better be able to pay their backup. They don't budget a year in advance as I do. This limits conversations about money to the bare minimum. It also prevents someone from leaving mid-year and not paying for vacation time during their enrollment. They never mind paying less, they do mind the invoices that are more. I just found a way to give them a NO that feels and sounds like a YES.

[dolores]

I invoice every 4 weeks at the weekly rate (wkly rate x 4). I charge for closings as I pay my employees for those. Parents get 1 week vacation without pay and I waive fee for the last week of August since I do not pay staff for that. That is all laid out in contract they sign so if there any questions I point them back to it.
I do agree with the comments to figure out what you want to make annually or the cost of care per child plus your profit and set your rates that way to be sure you are being compensated fairly...

Originally Posted by Blackcat31

The center does lose a week's pay.....Amy'sKids was quoting a poster that specifically said her center lost a weeks worth of fees ....because they didn't calculate it by the week and instead did the math per month."[/i]

I charge monthly. Some months can have 5 weeks, some 4, some 4+. Parents pay the same amount of money for each. I don't lose anything.
I am pretty sure, that in the case of the center weekly payment X 52weeks is equal monthly payment X 12 months.

[Blackcat31]

Originally Posted by Unregistered

I charge monthly. Some months can have 5 weeks, some 4, some 4+. Parents pay the same amount of money for each. I don't lose anything.
I am pretty sure, that in the case of the center weekly payment X 52weeks is equal monthly payment X 12 months.

I get how it works

The poster you quoted specifically said “ Which basically meant if there was 5 weeks in the month, they didn't have to pay for that extra week.”

I charge weekly so don’t care either way.

[Jo123ABC]

I have a family that pays monthly and I prefer it! I do an invoice for the month. Some months are 4 weeks and some are 5. I break down my invoice by the week so they pay for however many Mondays are in the month. They're paid up to Jan 3rd right now which puts their due date for January's payment due the morning of the 6th. It will cover Jan 6-31. I don't do a discount but I actually kind of like the idea of one since I prefer a monthly payment! I offer 6 sick/vac days for them to use whenever they want throughout the year.

[AmyKidsCo]

Originally Posted by Blackcat31

As a provider it's easy to understand but I think what Cat Herder is trying to say is parents don't understand the math when terms like "monthly" are used verses "weekly" in regards to tuition.

Most providers get it. It's usually the parents that need to do the math or have it broken down for them.

I call it "Flat Rate Monthly" and emphasize the convenience of being able to budget the same amount each month.