Laura LaBine is this week's guest writer.
There are many rewarding aspects to why we work, such as the satisfaction of connecting people to their dream job or celebrating a successful placement with a partner, but at the end of the day money pays the bills.
It’s always a good idea to have a conversation with your partner early and often to discuss payment terms. This doesn’t just refer to getting paid by the client, but also how we pay each other. Since some payment methods can take time to process or set up, it can be beneficial to set expectations with each other at time of placement. We owe it to each other to be super transparent and cooperative in communicating payment terms.
Setting clear expectations with our partners may not always be a one-off conversation. There may be situations out of our control (like check getting lost in the mail, client paying late, etc) and it’s always a good idea to share this type of information with your partner. Don’t be afraid to over communicate.
In this 21st century, there are many ways to send funds beyond checks or cash. PayPal is the most popular online money transfer tool, with free transfers when funded from you bank. For peer-to-peer transfers, a wide array of new tech platforms such as Zelle and Popmoney have made it easy to “text” someone money through secure connections. Zelle and Popmoney are essentially the same, but specifically used with certain banks. Zelle and Popmoney allow you to send money to others by using your bank’s mobile app. The only personal information that you share is either an email or mobile phone number. The platform manages the transfer securely. If your bank doesn’t offer Zelle, you can still send or receive money through Zelle by registering at clearXchange.com. Recipients don’t need a Popmoney account to accept payment. They’re notified via text or email that you’re transferring money to them. You can send money for free if a Popmoney user sends you a request. Otherwise, it’s only 95 cents if you initiate the transfer.
Online bill payments or bank transfers can also be used to have the bank mail or electronically transfer funds. Not all banks offer this for free, but most do. Many of them may also have a daily limit, usually around $10 to $25K.
Doing splits with international partners can be intimidating for some people, but a suite of different tools can make it easy while saving on fees. When you make a transfer abroad, there are two costs you may encounter. One is the upfront fee and the other is the foreign currency exchange margin.
Beyond traditional brands such as WesternUnion and MoneyGram that have high fees, there are other technical platforms where you can send money abroad OFX, Transferwise and Xoom are all very well respected and trusted platforms.
- OFX (https://www.ofx.com) was founded in Sydney, Australia 20 years ago. While there is a minimum transfer of US $150, they are robust enough to handle transfers up to US $2B. I haven’t seen a split fee that large yet!
- Transferwise (https://transferwise.com) takes about 2 days to get verified before you can send any large transfers. Their definition of “large” varies between currencies and banks.
- Xoom (https://www.xoom.com/) is a PayPal company specifically used for international funds transfers. They are fast, transferring to bank accounts abroad within minutes for some currencies up to $10K. If you send more than US $10K, there are an additional 2-3 business days to settle funds with your bank. Your payment method is based upon how much money you send, where you send the money and which currency you select for disbursement.
You may find that there are different options you prefer, and you may find that you have different methods for different partners. In conclusion, communicate early and often with your NPA partners and decide how you want to pay each other. Let’s set each other up for successful experiences!