Free tools · Every trade
What waiting to get paid costs
Put in an invoice and the days until it pays. See what carrying that money costs you, and what a faster payment would save.
- Every number is an estimate from your own inputs.
- Nothing you enter is stored or sent anywhere.
- General information, not advice.
Cost of waiting 45 days on $25,000
$369.86
About 1.48% of the invoice, at 12% a year.
- Each extra day costs
- $8.22
- If paid in 10 days instead
- $82.19
- Being paid in 10 days would save
- $287.67
- Simple interest on the invoice for the days it is outstanding.
An estimate from the numbers you typed. Nothing you enter leaves your browser or is stored.
Reading the result
Keep reading on this topic: How the float works.
How to read the result
The big number is what it costs you to wait for this one invoice, at the annual rate you typed. It is simple interest: the amount, times your rate, times the share of a year the money is outstanding. The daily figure is the same cost broken into days, which is the easiest way to feel what a week of delay means. The comparison line shows the same invoice paid faster, and the difference between the two is what a faster payment is worth to you.
The rate is the whole game. If you carry the wait on a line of credit, use its rate. If you factor invoices or use short-term funding, use the all-in annual cost of that. If you fund the wait from your own cash, use what that cash would earn or save elsewhere. The default is only there so the tool works before you have typed anything.
What to do about it
Multiply the result by the number of invoices you carry in a year and you have the size of the problem. Owners usually attack it from three sides. First, shorten the clock: invoice the day the work is done with complete paperwork, since most slow payments start as an incomplete invoice. Second, price the wait: a customer who wants 60 days instead of 30 can be quoted a price that covers the difference this tool shows. Third, decide in advance how a long gap gets funded, rather than finding out when payroll is due. Our plain explanation of the float covers the main ways owners do that.
One tool like this, every Tuesday
The Float is a free weekly letter on cash flow for owners who get paid after the work is done. Each issue ends with one tool or habit you can put to work before Friday.