What is Net D Payment Terms?
Net D payment terms (Net 30, Net 60, Net 90) specify how many days after the invoice date payment is due. Learn what Net D means, common variations, and how to negotiate payment terms that work for your freelance business.
What Are Net D Payment Terms?
Net D (or Net [number]) is a standard shorthand for payment terms on an invoice, indicating that payment is due within a specified number of days from the invoice date. The "D" stands for "days." | Term | Meaning | |---|---| | Net 30 | Payment due within 30 days of invoice date | | Net 60 | Payment due within 60 days of invoice date | | Net 90 | Payment due within 90 days of invoice date | | Net 15 | Payment due within 15 days of invoice date | | Net 10 | Payment due within 10 days of invoice date | | Net 7 | Payment due within 7 days of invoice date | | Net (no number) | By convention, Net 30 | The countdown starts on the invoice date — not the date you sent it, not the date they received it. If you invoice on March 1 with Net 30 terms, payment is due by March 31.
Common Payment Term Variations
Early Payment Discounts (2/10 Net 30) Often combined with Net terms: > 2/10 Net 30 means: > - If paid within 10 days: 2% discount > - Full payment due within 30 days > - Effective cost of not taking the discount: ~36% APR End of Month (EOM) > Net 30 EOM means: > - Payment due 30 days after the END of the month in which invoiced > - Invoice dated March 15: payment due April 30 > - Effectively extends Net 30 by ~30 days Other Common Variations | Term | Meaning | |---|---| | 1/15 Net 30 EOM | 1% discount if paid within 15 days of end of month | | Net 30 + 10 | 10 additional days grace period (rare) | | CIA | Cash in Advance — no credit terms | | COD | Cash on Delivery — pay upon receipt | | Due on Receipt | Pay immediately upon receiving invoice |
Understanding Net D from the Client's Perspective
Clients think about Net D differently than freelancers: Client mindset: - "We pay Net 60 vendors on the 60th day to preserve cash flow" - "We take all available early payment discounts" - "Net 60 is standard for our industry" Freelancer reality: - "I'm waiting 60 days to get paid for work I did today" - "I have expenses now, not in 60 days" - "My cash flow can't support 60-day payment cycles" This tension is why Net terms are negotiable.
Net Terms and Cash Flow
The impact of Net terms on cash flow is significant: | Terms | Work Done | You Get Paid | Cash Gap | |---|---|---|---| | Net 30 | Jan 1 | Feb 1 | 30 days of your cash | | Net 60 | Jan 1 | Mar 1 | 60 days of your cash | | Net 90 | Jan 1 | Apr 1 | 90 days of your cash | Example: You complete a $10,000 project in January. With Net 30, you have the money in February. With Net 60, you're waiting until March. With Net 90, until April. For a freelancer doing multiple projects: - If you complete $20,000/month in work and clients are Net 60, you have $40,000 in unpaid invoices at any given time - That's $40,000 of your cash that clients are using interest-free
Negotiating Payment Terms
As the Freelancer (Getting Paid Faster) 1. Start with Net 30 — It's the standard and reasonable baseline 2. Offer early payment discounts — 2/10 Net 30 incentivizes faster payment 3. Request Net 15 for new clients — Shorter terms until trust is established 4. Offer tiers — Better rates for faster payment (e.g., Net 15 at no discount, Net 30 with 2% discount) 5. Be willing to walk away — If a client insists on Net 90, your margins may not support it As the Client (Paying Slower) Large organizations often insist on Net 60 or Net 90 because they manage their own cash flow. Accepting these terms is sometimes the cost of doing business with big clients — but always factor it into your pricing.
Net D and International Payments
International payments often have longer effective Net terms due to: - Wire transfer processing times - Currency exchange delays - Different banking systems Consider: - Offering a small discount for wire transfer (they save on check processing) - Factoring international invoice discounting if cash flow is critical - Building the expected payment delay into your pricing for international clients
Net D and the Law
In the U.S., payment terms are generally governed by contract law: - If you agree to Net 60, you're legally obligated to accept payment within 60 days - Many states have prompt payment laws that set maximum terms for certain industries - Construction and government contracts often have specific payment requirements - Interest on late payments may be legally recoverable in some states Note: Accepting a Net 60 contract doesn't mean you can't send friendly reminders before day 60. Always follow up proactively.
The Bottom Line
Net D payment terms determine when you get paid — and how long your cash is tied up in client receivables. Net 30 is the standard starting point; shorter is better for your cash flow. Be cautious about agreeing to Net 60 or longer without factoring the cost into your pricing. Always send invoices early (don't wait until the due date) and follow up proactively as the due date approaches. (Get paid faster →) (Understand cash flow →) (Manage AR →) Key Takeaways: 1. Net 30 = payment due within 30 days of invoice date 2. Net 60 and Net 90 are common in big organizations — factor into your pricing 3. Early payment discounts (2/10 Net 30) incentivize faster payment 4. The longer the Net term, the more of your cash is tied up in receivables 5. Always send invoices early and follow up before the due date Invoice on better terms — Try Eonebill Free Eonebill's automated reminders and payment tracking help you enforce your Net terms and get paid faster — without awkward follow-up conversations. View Pricing → | Glossary Home → | Home →