Switched to a 3% late fee after 30 days and my overdue payments dropped by half

For years I was too nice about it, letting things slide for 60 or 90 days. Started adding the fee to every invoice six months ago. The number of accounts past due went from about eight to four almost immediately. Anyone else find a small penalty actually gets people to move faster?

4 comments

4 Comments

hannah9262mo ago

Yeah, that "small penalty" idea tracks with what I read in a business column last month. It said even a tiny cost makes a deadline feel real.

jennybailey2mo ago

Totally agree with @hannah926 on that. It's like putting five bucks in a jar if you're late for a gym session with a friend. The money itself doesn't matter, but you really don't want to lose it. Even a silly bet, like buying the next coffee, makes you hustle to finish a report. That tiny sting works way better than just a date on a calendar.

michael_williams2mo ago

So should I start charging my cat rent for being late to dinner?

alex82020d ago

Nah I'm going the other way on this one. People already hate paying bills, hitting them with a fee just makes them resent you and drag their feet even worse. I'd rather just send a friendly reminder after 30 days and let it slide until 60 before adding anything.