Ways to Manage Childcare Payments
In an ideal world, you can easily attract new families to your childcare center, build strong relationships with kids and their families, develop quality experiences for children, supervise staff, and manage your billing processes without a drop of sweat on your brow. If that’s not the case for you, Smartcare is here to help!
1. Distribute detailed enrollment agreements every year
From overtime fees to vacation rates, have families sign your enrollment agreements. Make every policy, especially the financial details, crystal clear. Detail your program’s processes so parents understand exactly how and when invoices will be sent and how payments can be made. Be sure to thoroughly explain your late payment policy.
Take action to clarify the details. Make sure each payment clause is written out step-by-step. Cover your bases and be transparent by establishing a plan for every potential payment related scenario.
Your payment agreement section should dive into the following:
- Dates and ways invoices are delivered, payment due date, and grace period
- Methods of payment accepted including:
- Cash
- Check
- Money Order
- ACH — Automatic deduction from checking or savings initiated by your center
Bank automatic payment from checking or savings - Debit card
- Credit cards: VISA, AMEX, MasterCard, Discover
- Late pick-up and overtime fees
- Rate clarification for holidays, vacations, and other absences
- A list of dates your center will be closed
- Field trip and miscellaneous fees
Late payment fees - Bounced check fees
- Credit card transaction and processing fees
- Expected registration or enrollment deposit due date
Be sure your enrollment agreement includes terms of service:
- Define the services provided
- Define the contract length
- Explain processes for cancellation and termination
- Confirm both center and parent rights to end the child care arrangement
Make sure your website and your family handbook include all the same details as your Enrollment Agreement. You want to set the stage for complete transparency, so all families will be successful.
2. Automate processes
One of the best things you can do for your program is to shrink your task list and wow parents by investing in software like Smartcare that are designed to streamline payment processes for program administrators and families.
These days, many parents are accustomed to paying their bills and taking control of their accounts online. Millennial and Gen X parents expect the efficiency and ease of online payments.
Software like Smartcare can also make your job easier and more efficient and ensure steady cash flow by automating billing and payments. Using software to manage payment processes will allow you to spend more time on the other challenges you face every day, instead of spending valuable hours manually doing work that can be automated by software designed by financial technology experts.
Want more tips on the benefits of a streamlined payment process? Visit SmartCare University webinar archives to learn Accounting Best Practices for Childcare Centers.
3. Send reminders
In general, parents want the best for their children and don’t intentionally want to have outstanding balances. However, we know they often need to be reminded. Give parents a nudge with automatically generated reminders about their balances. Sure, you can send out kind email reminders, put notes in backpacks, and personally remind them with a phone call or when they pick up. Seems simple, right? It can be, but it can also be very sticky for the adults who care for and educate children to constantly remind parents about payments.
Consider streamlining the process of keeping parents current on their tuition by using one of the same digital platforms that automate payments! Many of the same systems are designed to remind parents through email. By helping parents with friendly emails, you can take the sting out of tuition notices, save time, and make the process seamless.
There will always be times when you must confront parents about overdue balances. However, automating the billing process and providing real-time account balances 24/7 will reduce the number of outstanding balances; and the email reminders will prepare parents for the inevitable conversation should they choose not to comply with payment terms.
In conclusion, if you are having problems collecting payments, it’s never too late to start with these foundational tips. Restructuring your enrollment agreement can happen at any time; it can provide an opportunity to connect with parents to remind them of your center’s procedures. Automating your processes will be a welcomed addition to all your current parents, as will transitioning to clearer, more consistent communication.
Smartcare has a comprehensive, one login platform designed for easy use by administrators, daycare teachers, and parents. You can manage records, attendance reports, and prospective family visits as well as automate billing and offer more payment methods to families.