Always Collect a Deposit
A deposit serves two purposes. First, it covers your initial material costs so you are not financing the project out of pocket. Second, it demonstrates customer commitment.
A customer who pays a deposit is far less likely to cancel or change their mind. It creates skin in the game for both parties. Standard deposits range from 25 to 50 percent depending on the trade and project size.
Progress Payments Keep Cash Flowing
For projects that take more than a week, progress payments tied to milestones keep cash flowing throughout the job. Instead of waiting until the end for a big payment, you get paid as you complete phases.
A typical structure might be 30 percent deposit, 30 percent at rough-in, 30 percent at substantial completion, and 10 percent at final walkthrough. Adjust the percentages to match your trade and project scope.
Put It in Writing Every Time
Payment terms should be clearly spelled out in your estimate or contract. Include the deposit amount, payment schedule, accepted methods, and what happens if payments are late.
Verbal agreements about money are a recipe for disputes. When everything is documented and signed, both sides are protected.
Do Not Release Lien Rights Until You Are Paid
In most states, contractors have lien rights that protect their ability to get paid. Understanding your lien rights and using them properly is critical for larger projects.
Do not sign a final lien waiver until you have received full payment. This is your strongest leverage, and giving it up prematurely removes your protection.
Platform Solution
How myCT1 Business-in-a-Box Solves This
myCT1 handles payment schedules and deposits as part of your estimate-to-invoice workflow. Set up deposit amounts and milestone payments when you create the estimate, and the system automatically generates invoices at each stage.
Track payment status across all active jobs from one dashboard. Automated reminders go out when payments are due. The customer portal lets clients see their payment schedule and pay online, reducing friction and delays.
Our platform also supports lien waiver management, helping you track what has been signed and what payment has been received.