Retainer Fees?

[daismoll62]

Hi everyone,

I am a new childminder and currently have a couple of children... a lady called me the other day who was interested in my services from September when her child starts nursery, and asked if I could ensure her a place with my childminding. I just wondered where I stand on charging her a fee to hold her place until September? She has been to look around my home and is happy to sign paperwork etc but obviously it's still 4 months until she wants her child to start with me and it would mean me saying no to other parents in the meantime.
What do you do in this situation? Any advice would be much appreciated!
Debbie x

[bunyip]

This is a copy/paste of something I've posted previously. Hope it helps......................

CMs often use a deposit or a retainer to 'hold' a place for future use.

A deposit is a one-off payment put down by the parent to guarantee the child starts on the contracted date. If they don't start, you get to keep the deposit. If they do, then you either refund it or credit it towards the cost of childcare. You also need to consider and integrate this with any 'settling in' clause you use. eg. I allow myself or the parent to give immediate notice at any time within the 1st 4 weeks of care (in case they don't like me after all or the child turns out to be the Spawn of Satan) - but it would hardly be fair to ditch little Damien on day 1 and keep the deposit.

A retainer is a regular payment to ensure you keep the place open for the child. Parents often dislike this - and why not? you are, to all intents and purposes, being "paid to do nothing". You need to get them to understand this from another angle, viz the retainer is what they pay you to ensure their lo's place is held and still there ready when they need it. BUT you must never regard a retainer as 'free money'. It buys a service, which is that you have the place open for them if they want it. So, you cannot charge them a retainer and fill the place with another child during that period (not even for 1 day); and you cannot close for the week and fly down to Rio. Also, you cannot really refuse them if they want you to have their lo start early or attend on one or more of those days, assuming they give fair warning and pay the top-up fee; not even if you booked in at the hair salon - by accepting the retainer you are saying "I'm open and ready for business." Avoid nasty shocks by getting any such bookings in writing and do not confirm them unless/until paid for in advance.

Whether you decide to use a deposit or a retainer, you need to make sure the Ts&Cs are covered adequately in your contract, to avoid the possibility of a dispute later. Make sure the parents understand what they are committing to and what they are/aren't entitled to. Advance bookings are always a wee bit fraught. You have the promise of work, but no guarantee they won't pull out, and you could be turning down better offers in between. So you just have to make the best of it and have some sort of money arrangement that compensates you if it doesn't work out.

[tess1981]

You could also say as long as no one else enquires about the space you will not charge a retainer. So if in 2 months time a lady comes along looking the space you can tell the other lady someone looking space if you still want then I charge a retainer from now til start date. I find that a fair way and the parent should in theory be thankful you are being honest

[lollipop kid]

An approach that I've used in the past is to sign the parent up, take a deposit (non-refundable if they don't join, but refundable at the end of the childminding contract if they do), then take a retainer as well from the contract date until start date.

However, with the retainer, you can't include a period of holiday (yours or theirs) and the space has to be available to that child if the parents want it (with adequate notice).

I have offered to parents before that they can bring their child for 50% of the contracted time until their child starts (covered by the retainer fee), and this therefore means that the child is settled in before the parent goes back to work. (It works great for younger children.) So if the child is due to be with me for 3 days, they can come for 1.5 days each week as settling in time until the contract starts proper. With this arrangement, I usually specify that if they don't come one particular week, and don't use these retainer days, then they can not get carried forward into another non-retainer period. (It's not a bank!)

Hope it helps,

L