A payment plan contains one or more installments, each with a due date and an amount due. This article covers all of the options and the best time to use each one.
In this article...
Due date options
Amount due options
Relative due dates
Relative due dates allow the payment plan template to automatically adapt to any invoice in any project. We recommend using a relative due date whenever possible.
When a payment plan with relative due dates is applied to a specific invoice, the exact due dates calculate and fill in. Each due date will be based on the timing and trigger you choose, such as "30 days before project start date."
Relative due date triggers
Relative due dates are set up with timing and a trigger that will be used together to calculate the exact due date. For the timing, you can enter a number of days, weeks, or months in relation to the trigger.
Before/after project start date and before/after project end date
These triggers calculate a due date based on the project date. If your project date is a single date, it will be treated as both the start and end date. If there's no project date set, the due date will appear as (TBD) until you set one.
For example, if the relative due date is "30 days before project start date," payment would be due 30 days before whatever date is set as the project date.
After payment plan applied to invoice
The due date will be calculated based on the date the payment plan was applied to the invoice. Sometimes, this will line up with the same day you are creating the invoice, but not always.
For example, if the relative due date is "0 days after payment plan applied to invoice," payment would be due on the same day you apply the payment plan to the invoice.
After contract signed by client
This trigger will wait to calculate a due date until after the contract on the project has been signed. If you're sending a proposal-contract-invoice, this is a good trigger to use for the first payment.
For example, if the relative due date is "0 days after contract is signed by client," payment would be due on the same day the client signs the contract. Keep in mind that the due date will display as TBD until the client signs and submits the contract.
Fixed due dates
A fixed due date is an exact calendar date such as 07/29/2021. Each time you use the payment plan, no matter when the invoice was created, the due date will be the exact same date.
It's not common to use a fixed due date in a payment plan template. The only reason to do so is if you're setting up templates for a specific holiday offer or event.
TBD due dates
The TBD due date option stands for "to be determined." It acts as a placeholder for you to manually set a due date after the payment plan has been applied to an invoice.
TBD is the best option when a payment is due before delivering something like a design or website launch and you don't know the exact date upfront. You'll be able to set a specific due date for the installment on the client's invoice once you're ready.
Divide amounts equally
This option automatically calculates the amount due based on the number of installments set to divide equally. This option allows a payment plan template to adapt to any invoice total.
For example, if you have a payment plan with three installments, each set to divide equally, Dubsado will automatically divide the invoice total into three equal payments. No math required!
👋 Here's a tip... use divide equally in your plans whenever possible! There are often cases where you could use either a percentage or divide equally for the amount, but divide equally will keep your payment plan more flexible in case you make changes to a client's invoice after they've already made a payment.
A percentage amount automatically calculates based on the invoice total. Similar to divide equally, this option allows a payment plan template to adapt to any invoice total.
However, unlike divide equally, this option allows you to set a specific percentage. Use percentage amounts whenever you need more control over how the installments are distributed, such as a 50% deposit followed by two more payments of 25%.
The total of all the percentage amounts cannot be more than 100%.
A fixed amount is an exact dollar amount, such as $500.00, that will not change based on the invoice total. Use a fixed amount if you always charge the same amount for a specific payment, such as a deposit.
Combining divide equally, percentage, and fixed amounts
You can use a mix of divide equally, percentage, and fixed amounts in the same payment plan. Installment amounts are calculated based on the invoice total in the following order:
Fixed amounts are subtracted from the invoice total first, before percentage amounts are calculated. The order of installments in the plan does not matter.
For example, let's say you have a payment plan with two installments. One is $500.00 fixed and the other is for 100%. The 100% installment will cover whatever is left of the invoice total after subtracting $500.00.
The divide equally option takes the invoice total that is not covered by fixed or percentage amounts and splits it equally across all the divide equally installments in the plan.