The math behind a late-fee: turning "net 30" into an enforceable number
I build small web tools, and the one that surprised me most wasn't AI-heavy at all — it was a late-fee calculator for freelancers. The hard part wasn't the arithmetic. It was deciding which arithmetic is defensible enough to put in front of a client who is already 45 days late.
This is a short write-up of the reasoning, with the actual formula I shipped in Invoice Rescue.
Simple interest, day-count, no compounding
The instinct is to reach for compound interest. Don't. For overdue B2B invoices, a client-facing fee that compounds daily reads as punitive and invites a dispute. Simple interest on a daily accrual is both easier to justify and closer to how most late-payment statutes actually describe it.
