Saturday, 7 February 2004

How contracts work

I did not know this, so I thought that I would pass this info along. I signed a contract that says my employeer will not have to pay me for 30 days. Well, the thing that I didn't realize is that it is 30 days after they receive your invoice. And they only accept an invoice after 30 days too... (I have to double check this last one, but I think that it is correct). So in effect, you don't see money till after over 2 months of working.

In my business classes, they always talked about one of the problems small businesses have is cash flow problems. They might have enough money to pay things, on paper, but it's not in the bank when they need it. I always thought "ya, that's pretty dumb problem. How could they not see that coming? Dummies." What problem do I have now? Ya, you guessed right. And I should have seen it coming. What a dummy.
Listening to: Moxy Fruvous - Dancing Queen


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6 comments:

  1. Ryan7 February 2004 at 11:43

    Rather than go into credit card debt, try to get a line of credit. The interest rate on mine is 6.25%! that's 1/3 of my credit card.

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  2. Jim7 February 2004 at 12:05

    What I am going to do is borrow some money from my mom... and the "interest" for that is just a dinner out (which is probably going to be more than 6.25%)
    ;-)

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  3. Ryan7 February 2004 at 12:12

    You really should have a line of credit anyway ... they come in handy.

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  4. Jimmy7 February 2004 at 14:57

    So if you finish their work in four months, they will only pay you for two months of work? Wow!

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  5. Jim8 February 2004 at 09:00

    I think that you misunderstood Jimmy. There is a delay, not lack of payment. If I stopped working in 2 months, they will still be paying me two months after I finish...

    ReplyDelete
  6. Jimmy8 February 2004 at 14:48

    Oh, now I understand!

    ReplyDelete

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