The Paid-First Setup: Deposit Clause, Auto-Charge Consent Line + Invoice Template

Why most agencies end up chasing money

Ignition's 2025 Agency Pricing and Cash Flow Report surveyed 273 managers and executives at US agencies. Here's how they get paid:

So most agencies do the work first and hope the money follows. The Paid-First setup flips that: money first, work second, with 4 simple parts.

Part 1: A deposit to start

Why: a deposit proves the client is serious, covers your first costs and means you're never more than one payment behind. A common rule is 30% to 50% before kickoff.

1. Example project: $6,000.
2. 50% deposit = $3,000 before kickoff. Balance of $3,000 on delivery.
3. Or 30% deposit = $1,800 before kickoff. Balance of $4,200 on delivery.
4. Bigger or longer project? Split the balance into milestones, each paid before the next stage starts.

PAYMENT AND DEPOSIT

To reserve the start date, the Client pays a deposit of [50]% of the total project fee ([$3,000] of [$6,000]) before work begins. Work starts within [2] business days of the deposit being received.

The remaining [50]% ([$3,000]) is due on [delivery / the date of the final milestone], before final files are handed over.

The deposit is [non-refundable once work has started / refundable minus work completed to date if the project is cancelled before (date)].

If any payment is more than [7] days late, work pauses until it is paid, and deadlines move by the same number of days.

Part 2: Card on file, auto-charge

Why: if the card is already saved, the payment happens on the due date without anyone remembering, approving or chasing. Only 20% of agencies in Ignition's survey work this way.

How: use a payment tool that can save a card or bank account and charge it later, like Stripe. You need the client's clear permission first. Stripe's own guide says your terms should include:

• The client's agreement that you can start payments for specific charges.
• When and how often you'll charge (for example, the 1st of every month).
• How the amount is set.
• How to cancel, if it's an ongoing service.
• And you should keep a record of their written agreement.

AUTOMATIC PAYMENTS

By signing, the Client authorizes [Your Agency] to charge the card or bank account saved on file for:
- the monthly retainer of [$4,000] on the 1st of each month, and
- any approved extras, on the day they are approved in writing.

The amount charged is the retainer plus any approved extras for that month, as shown on the invoice sent [2] days before each charge.

The Client can cancel automatic payments or the retainer with [30] days' written notice to [email]. Payments already made for work completed are not refunded.

Client name: ____________  Signature: ____________  Date: ________

Part 3: A pay button in every invoice

Why: every step between "I got the invoice" and "I paid" is a chance to put it off. A link they can pay with in one click removes the steps. A Xero analysis of about 10 million invoices from over 150,000 small businesses (as reported in 2019) found invoices with a payment service attached were paid in about 12 days instead of 22.

INVOICE #[2026-011]

From: [Your Agency], [address], [email]
To: [Client company], [contact name], [address]

Invoice date: [Nov 1, 2026]
Due date: [Nov 7, 2026]

What this is for:
[Monthly retainer, November 2026: cold email campaigns, 2 lists, weekly report]   [$4,000]
[Approved extra: landing page copy (approved Oct 28)]                       [$500]

Total due: [$4,500]

PAY NOW (card or bank): [your payment link]

Or bank transfer: [bank name, account name, account number, routing / SWIFT]
Please use the invoice number as the reference.

Questions? Reply to this email or call [phone].
Thank you!

Part 4: Bill retainers on the 1st, before the work

Why: if you bill at the end of the month, you've already done a full month of work for free, and then you wait for payment on top. Billing on the 1st means you're paid for the month you're about to work.

Ask on day one

This only works if it's in the proposal and the contract, before the first invoice. Bringing it up on the 3rd invoice feels like a change of rules. On day one, it just feels like how a professional business works.

"How we work: a 50% deposit reserves your start date, and the balance is due on delivery. For the monthly plan, we save a card on file and bill on the 1st, so the work never stops waiting for an invoice."

Worked example: one client, one year

1. A $4,000 a month retainer, billed at month end and paid about 22 days later (no pay link), means you're always owed for 3 to 7 weeks of work: roughly $3,000 to $7,000 at any time.
2. Billed on the 1st with auto-charge, you're owed $0 on most days.
3. Chasing one late invoice takes, say, 1 hour (example). 12 invoices with 1 in 4 late = 3 late invoices, 3 hours a year, for one client. With 10 clients that's 30 hours a year.
4. Auto-charge turns those hours into zero, and the money arrives on the day you planned.

Common mistakes

Adapt it to your business with Claude

I run a [type of agency / freelance service] in [country / state].
My offers: [project at $X], [monthly retainer at $Y].
I use [payment tool, e.g. Stripe] to take payments.

Write my Paid-First setup:
1) A deposit clause: [30-50]% before kickoff, balance on delivery, what happens if the project is cancelled, and a pause rule if payment is over 7 days late
2) An auto-charge consent line for my retainer: what will be charged, when, how the amount is set, and how to cancel
3) An invoice template with a pay link, due date and bank details
4) Two sentences I can put in my proposal to explain this in a friendly way

Use plain English, short sentences. Then list anything a lawyer in [country / state] should check before I use it.

Links and tools

Quick answers

Won't asking for a deposit scare clients off?

Most agencies already ask for something upfront: 49% take a partial payment in advance and 16% want the full amount, per Ignition's survey. Asked on day one, in the proposal, it reads as normal and professional.

How big should the deposit be?

A common rule is 30% to 50%. Bigger or riskier projects lean toward 50%. For long projects, split the rest into milestones paid before each stage.

Is it OK to save a client's card and charge it automatically?

Yes, with their clear written permission for that specific use. Your payment tool's rules and local law decide the details, so use the consent line, keep a signed copy, and check with a lawyer.

What if a client refuses auto-charge?

Keep the deposit and bill on the 1st with a pay link and a short due date. You still get most of the benefit.