How To Get Paid: Freelance Invoice Templates, Engagement Contracts, And Other Tools For SuccessNov 08, 2022
One of the first “reality checks” for anyone who has made the decision to become a freelancer involves a basic challenge for any business - how to get paid. This seems simple enough, but it can be maddeningly complicated if a system is not in place.
As an employee, project schedules are set, work is completed, project billing information is emailed to the accounting department, and “somebody else” takes over from there. Unfortunately, as a freelancer, there is no “somebody else.” It’s just you.
Getting paid on a timely basis is critical to survival for any independent contractor, and this makes having tools such as freelance invoice tools and employment contracts a top priority.
Learn about the business tools that help freelancers get paid on time. Click here to sign up for a FREE webinar on November 17, 2022.
Pro Tips for Getting Paid
“The first step to getting paid is clear communication, presented in writing, in the form of a binding contract,” noted well-known Virtual Expert® founder Kathy Goughenour. “There are rarely problems getting paid. If freelancers have signed contracts that clearly state the following:
- What charges will be for specific services rendered
- How and when these charges are to be paid from an invoice
- How the freelancer accepts payments (direct bank transfer, electronic payment services such as “PayPal” or other means)
- And what actions will be taken if the payment is not made on time
“The contracts are helpful to both the client and the freelancer because everyone knows what is expected and what happens if that doesn't occur. If a client is late paying, the freelancer simply follows through on that which is laid out in the contract. On those rare occasions when clients are unresponsive and refuse to pay, freelancers can send the client's account to a collection agency.
“For those in Virtual Expert® Training, we provide contract templates created by a reputable law firm. We also provide recommendations on how to professionally follow up with late payers and can provide recommendations for a good collection agency to work with.
“If a freelancer does not have a signed contract, they open themselves up to missing out on payments, with no legal leg to stand on. Of course, clients are not going to pay without receiving an invoice. So, an easy-to-understand invoice that is sent at the consistent date stated in the signed contract is crucial to getting paid.”
What are the components of a great freelance invoice? For starters, clarity is paramount.
Kathy highlighted the specifics that should be included in every freelance invoice:
- The freelancer’s business name and contact information
- The name of the freelancer’s client for whom the work was performed
- A short description of the work performed (as a reminder to the client)
- The project rate, package rate, or hourly rate. If it’s an hourly rate, then the number of hours and the number of hours spent on which tasks
- Sales tax if required by the state or county in which you reside (this is rare)
- A grand total for the invoice
- An invoice number and date
- The due date
- A clickable link to allow a client to easily make a payment
- A statement about what happens if payment is late
Tracking the Work
While most clients do not require a freelancer to supply minute-by-minute times for project completion, Kathy sees some benefit to the freelancer for tracking their work.
“Independent contractors want to be able to track their time, so they know what to charge on an hourly basis,” she said. “Understanding how long projects take to complete is extremely advantageous to a freelancer. This allows them to price their work correctly for package/project rates.
“There are many excellent tools for this process. Here are two articles that provide reviews on the best “time-tracker” services to help someone choose one that works best for them: https://apploye.com/independent-contractor-time-tracking/ and https://www.softwareadvice.com/resources/time-tracking-software-for-contractors/.
“I also recommend freelancers identify which software they prefer to use to create and send invoices and to automatically send reminders if the invoice isn't paid. Here’s an article that provides reviews of the best invoicing software programs for freelancers I like.”
Kathy Goughenour has helped thousands of freelancers, independent contractors, virtual assistants, and Virtual Experts® learn the skills and get the tools it takes to be successful. You can learn tips on freelance invoicing during a FREE, one-hour webinar on Novemnber 17. Click here to sign up and start getting paid!
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