These posts about the studio policy and contract have been great! So many smart ideas have already been shared so I don't have much to add. However, I thought I would share the way I do lesson payment in my studio.
First of all, let me say that automatic online payment (like mubus.com) is the ideal collection method for the teacher. However, if your students' parents feel at all uncomfortable with providing their credit card information or having payments automatically drafted from their account, another option is to use post-dated checks. At the beginning of each semester, my parents write checks for each month of that semester and date them the first of each month. This means that I only have to collect payment once a semester (because isn't asking for payment the worst?), but parents don't have to pay for the entire semester all at once, which can be a financial burden to some families. The bonus for me is that at the first of each month, I already have all the checks for that month in my possession and they are valid for deposit.
Just an idea, but it has worked really well for my studio.