deposit?

[ziggy]

I am seeing a mummy this week who wants me to take her baby 4/5 days a week. Looking at starting end of February, so after learning some hard lessons I want to be more business like and have mentioned paying a deposit.

How much deposit do most charge?

[Minstrel]

I charge 4 weeks.

It's the first invoice or non- refundable if they pull out or leave in the first month.

[samb]

I charge 1 weeks "registration fee" as a nonrefundable up front one off payment.

[Snowwhite]

i charge half of the months fee and that is non refundable and then its just the other half to pay on the month that they need the childcare to start. I find that some parents dont always like paying the half fee deposit and try and bring it down,due to paying nursery fees,but i think that they can shove off in that case! I do explain the reasons for the deposit

[sing-low]

I charge four weeks deposit which I keep until the end of the contract to off-set the last month's fees (and to cover me in case they do a runner). I also charge fees up front, which I do on a weekly basis. Weekly invoices are a pain but it felt like a huge ask to say two month's fees up front which is effectively what it would have been if I asked for 4 weeks deposit as well as a month's fees in advance.

[maisiemog]

I charge 2 weeks and this is taken off the final months invoice. Had too many parents leave and try and get out of the last months payment not to do this!

[ziggy]

thank you, will have a think about it

[lisbet]

I ask for fees monthly or weekly in advance. If parents want to sign up for a delayed start, I ask for a month's fee on completion of contract. I explain clearly and put in the contract that this can be used to pay the first month's fees, but is non refundable if they break the contract and do not take up the place.

[dawn100]

One months fees as deposit which is taken off first months fees but is non refundable if they don't take the place or leave within the month. Then all fees are in advance.

[Simona]

It would be advisable for CMs to charge a 4 weeks deposit which is refundable when notice is given at the end of care
If we charge a deposit and then refund it via the first month fees we are left uncovered in case of non payment...it would save a lot of heartache
Rather than a deposit we can charge 1/2 retainer until the place is taken up....if the parents then refuse the space the retainer is not repayable to them

Please think about taking a deposit... it is well within our rights as long as we clearly state it will be refunded at end of care...no one could rent a property without paying a deposit in advance

[dawn100]

It would be advisable for CMs to charge a 4 weeks deposit which is refundable when notice is given at the end of care
If we charge a deposit and then refund it via the first month fees we are left uncovered in case of non payment...it would save a lot of heartache
Rather than a deposit we can charge 1/2 retainer until the place is taken up....if the parents then refuse the space the retainer is not repayable to them

Please think about taking a deposit... it is well within our rights as long as we clearly state it will be refunded at end of care...no one could rent a property without paying a deposit in advance

I understand your point and understand why cm do but when I was using a cm when my eldest was little finding the money for a deposit of the first months fee and then each months fees whilst waiting for tax credits I found hard enough if I had to of found then money for another month fees then there would of been no way I could of found the money so wouldn't of been able to return to work. So for that reason I don't hold a months fees to be refunded at the end of contract, just take it as first months payment.

[Simona]

I understand your point and understand why cm do but when I was using a cm when my eldest was little finding the money for a deposit of the first months fee and then each months fees whilst waiting for tax credits I found hard enough if I had to of found then money for another month fees then there would of been no way I could of found the money so wouldn't of been able to return to work. So for that reason I don't hold a months fees to be refunded at the end of contract, just take it as first months payment.

I totally appreciate that a deposit is a very large sum of money for parents to have to part with...maybe CMs could use their initiative and think of adjusting the sum that can be given as deposit?....having said that no parent would be allowed to enrol at nursery without paying a deposit so why should we make exception as CMs?
it is of course our choice but I would say one that leaves the door open to problems...my view of course

Judging by the number of posts in this forum regarding late payments or indeed no payment at all and the subsequent trouble trying to get that money from the parents......... I would think that a deposit would be the simple solution to avoid facing those situations...even CMs who use contracts seems to have parents running away without paying fees...how?

A deposit is a very good deterrent...speaking from experience I have never had a parent run away without paying because the deposit made sure it would be a useless exercise

We are in times of austerity but that works both ways and again in my view a financial arrangement is exactly what it should be
I am sure that many CMs are not that keen on subsidising 'free education' for children? the last thing they may wish to do is also subsidise fees in instances of disputes?

it is our choice of course and again this is my personal view!

[dawn100]

I totally appreciate that a deposit is a very large sum of money for parents to have to part with...maybe CMs could use their initiative and think of adjusting the sum that can be given as deposit?....having said that no parent would be allowed to enrol at nursery without paying a deposit so why should we make exception as CMs?
it is of course our choice but I would say one that leaves the door open to problems...my view of course

Judging by the number of posts in this forum regarding late payments or indeed no payment at all and the subsequent trouble trying to get that money from the parents......... I would think that a deposit would be the simple solution to avoid facing those situations...even CMs who use contracts seems to have parents running away without paying fees...how?

A deposit is a very good deterrent...speaking from experience I have never had a parent run away without paying because the deposit made sure it would be a useless exercise

We are in times of austerity but that works both ways and again in my view a financial arrangement is exactly what it should be
I am sure that many CMs are not that keen on subsidising 'free education' for children? the last thing they may wish to do is also subsidise fees in instances of disputes?

it is our choice of course and again this is my personal view!

I fully understand where you are coming from, but I do believe non paying, really late payers etc are in the minority, yes we do see posts about them on here but people don't post about those who do pay on time and I don't come on here and post about one parent who normally pays me 5 days early, we only hear the negatives it's the same with everything in life. I have payment in advance and have written in my contracts i can withdraw care if payment is late so I will never work for nothing but at worst risk not being paid the notice period, which is a risk I am happy to take if it means I can help parents out. When I was returning to work as a single mum my cm was a life saver and without her and the way she charged I would of been stuck wanting to return to work but unable to find the money for a deposit and fees.
I fully understand why and am not against cm taking a deposit and holding it but for me personally it not what I choose to do.

[Mummits]

I accept paypal for deposits - in fact for fees too though nobody has yet done that. That means parents can pay by credit card and should have their tax credits sorted before they need pay the credit card bill, if that is a consideration.

[smurfette]

I accept paypal for deposits - in fact for fees too though nobody has yet done that. That means parents can pay by credit card and should have their tax credits sorted before they need pay the credit card bill, if that is a consideration.

I use paypal for ebay etc.. Are the fees very high on larger amounts though? It is a good idea!

[loocyloo]

I use paypal for ebay etc.. Are the fees very high on larger amounts though? It is a good idea!

I was just wondering that, whilst thinking it was a good idea!

[Mummits]

I think the fees are actually lower for larger amounts, but about 3% for smallish amounts (in the hundreds).

I think the main point of having a deposit is to discourage people from messing us about, usually by booking a place then changing their mind. Without a deposit they could easily be reserving places all over the place (I know somebody who tried to do this!) with no incentive to make up their mind and commit to one or the other. It also discourages people from failing to give the required notice when they leave. To me, the deterrent effect is more important than the precise amount.

All my children are part time, so a deposit is not usually more than about four hundred pounds, but still a considerable amount if the parent is not yet working or has not yet had their first pay packet. If they can pay on a credit card they can demonstrate their commitment whilst deferring the actual payment for anything up to two months, or even spread it over longer if they don't mind paying some interest.

The last payment I took on paypal was about £400 and I think I paid £12 something in charges - that is received £12 less. I do say in my policies that the parent has to pay the charges (I think paypal asks whether they want to do this when they set up a payment) but I didn't pursue it, just said they would get back what I received. By the time people leave, the deposit often no longer reflects a month's fees anyway.

I suppose paypal fees would be a legitimate expense anyway, just as banking charges for payments in foreign currencies would be, just part of the expenses of the business. I've never bothered to claim it, but if lots of people started using paypal I probably would.

Anyway, it seems to work for me. I just say if you want to reserve a place, you need to pay £x deposit, and I accept cash, cheque, bank transfer, vouchers - or paypal if you want to use a credit card. I think some people also find it reassuring that they could use a card if they had some sort of financial crisis at some point in the future - less embarrassing than asking to delay payment.

[Simona]

I think the fees are actually lower for larger amounts, but about 3% for smallish amounts (in the hundreds).

I think the main point of having a deposit is to discourage people from messing us about, usually by booking a place then changing their mind. Without a deposit they could easily be reserving places all over the place (I know somebody who tried to do this!) with no incentive to make up their mind and commit to one or the other. It also discourages people from failing to give the required notice when they leave. To me, the deterrent effect is more important than the precise amount.

All my children are part time, so a deposit is not usually more than about four hundred pounds, but still a considerable amount if the parent is not yet working or has not yet had their first pay packet. If they can pay on a credit card they can demonstrate their commitment whilst deferring the actual payment for anything up to two months, or even spread it over longer if they don't mind paying some interest.

The last payment I took on paypal was about £400 and I think I paid £12 something in charges - that is received £12 less. I do say in my policies that the parent has to pay the charges (I think paypal asks whether they want to do this when they set up a payment) but I didn't pursue it, just said they would get back what I received. By the time people leave, the deposit often no longer reflects a month's fees anyway.

I suppose paypal fees would be a legitimate expense anyway, just as banking charges for payments in foreign currencies would be, just part of the expenses of the business. I've never bothered to claim it, but if lots of people started using paypal I probably would.

Anyway, it seems to work for me. I just say if you want to reserve a place, you need to pay £x deposit, and I accept cash, cheque, bank transfer, vouchers - or paypal if you want to use a credit card. I think some people also find it reassuring that they could use a card if they had some sort of financial crisis at some point in the future - less embarrassing than asking to delay payment.

I agree with you and as small businesses we need to protect our viability and prevent any sort of trouble

Are non paying parents and those who pay late few? I am not totally convinced personally....
I doubt that parents would be shocked to hear they need to pay a deposit ...look for instance at the news reported yesterday that car sales have risen dramatically...can anyone buy a car without a deposit? that too would be hefty....in fact thinking about it I doubt any big purchases can be made without a deposit so why do we consider our businesses different?

[Mummits]

Late payment is very common in my experience, and again in my experience it is often not the parents who you would think might be struggling to get the money together who are most often late, it is the ones who are apparently well-off but generally seem a bit disorganised and forgetful. I think I should apply late fees but tbh if they are generally okay and I am confident they will pay I let it go.

I think deposits are a different matter. Here you are often talking about trusting someone you don't know at all, and potentially losing other business if that trust is misplaced. I have been messed about or let down a couple of times recently and it has made me strict about deposits. In fact last time I didn't take a deposit because I thought I knew the parent well enough to trust them, they did let me down and it cost me several other enquiries.

I also wrote a little while ago asking for advice about how to weed out timewasters, having had a couple of parents complete contracts then fail to provide the deposit promised and then backing out or disappearing. I subsequently found one of them had also promised the work to a fellow childminder. I have since been asking for a deposit to reserve the place before even doing any other paperwork, and try not to regard the work as "won" until that happens. I have also stressed to parents who visit that the place is still available until the deposit is paid. Whilst I thought that might put people off, it hasn't stopped me filling my places. I used to be very shy and hesitant about talking about any financial matters, but am getting more matter-of-fact about it and am finding that parents react very well to that on the whole.