How Do Freelancers Get Paid
Understand the process of getting paid as a freelancer
About The Money
Is it possible to work purely for yourself? No boss. No company contracts. Nothing. Well, although it might be surprising for some, it is possible. Even more so, it is quite easy too! As a freelancer (a.k.a. a self-employed person specialising in a certain service or skill) you can easily get paid for your work without the need for a third party. In other words, you can gain income doing what you’re good at. You just need to understand how freelancers get paid.
In this brief article, we will explore how freelancers get paid and consider the many avenues of income transfer that can be used to do so. If you’re considering freelancing in 2022, it’s not too late to make some New Year’s Resolutions for Professionals to help you nail your goals.
Agreeing Your Rate
‘It takes two to tango’. That’s a fact. It is the same with agreeing on any business-related arrangements ever. You have to get on the same page with your client. Considering the rate you’re willing to charge for your services is the first step to getting paid for your freelance work. You have to know your price. So, think about it for a moment – how much do you want to earn for your work?
When thinking about this, it is useful to reflect on the many aspects of your pricing. Think of the type of contract or assignment you’re taking up. Ask yourself whether getting paid per hour rather than per task is the right option for you. Do you need some of the price paid upfront? Are you going to ask for a deposit or will you simply take all of the payment, once the project is completed? You need the answer to these questions before the meeting with your client arrives, so think about it in advance.
Regardless of whether your work is paid hourly or per task, you should try to keep a log of your performance. This will help you become more efficient as well as provide you with a great database of information for your client to consider. If, for example, your recent project required the use of additional materials, for which you’d like to be reimbursed, keeping a transparent log of these expenses will help you get that money back when approaching the client. Moreover, with a detailed backlog of your time use, you’ll be more likely to save time on non-necessary tasks in the future. It’s a win-win either way.
How did the project go? Could you adjust your pricing or change the rules of rates to improve your performance processes? Can you save on materials by applying a breakdown of production costs in the initial contract? All of these ideas are worth exploring when your next assignment approaches. Keeping a timesheet, breaking down the costs, and organising your work-time better will help you get paid more and do more with your business.
What proof of income do I need? You’ve got to have an invoice. Do not forget that! An invoice is nothing more than a document validating your earnings. It is necessary to present your self-employment income to the government and it will help you stay on top of your cash flow once your entrepreneurship flourishes. A valid invoice has to have a date, a reference number, your address, an account to which the income should be sent, and details of the work delivered. It is as simple as that. It’s an agreement between you and your client, so make sure a signature of yours staples the document before you send it away.
It is up to you whether you’ll create a digital version or produce a paper copy. Either of them works just as well. Make sure to keep track of your work, organise a file to keep your invoices in, and make your business transparent to avoid any trouble down the road. This is key, as it’s a core component of how freelancers get paid.
What channels of payment can I use? A bank transfer is an option, but there are also many alternatives. You’ve probably heard about PayPal or a similar platform, which allows money transfers without the need for extensive information. The choice is yours and it is often a question of preference.
Maybe you’d like to set up a direct debit, since your work will be done consecutively for the next few months, or else you’d prefer to be paid some of it upfront. The differences between these options are cosmetical and depend solely on the rate, type of work, and personal preference of yours and that of your clients. So, choose the billing method that works best!
My Client is Late Paying Me
Sometimes things don’t go to plan. That’s just life, isn’t it? One of these situations can happen when your client delays the payment causing you some stress and trouble. There is no ‘one-size-fits-all’ approach to this, but there are some steps you can take to help such situations.
Think about setting some ‘late fees’ charges when you sign the initial agreement. It is a common practice to present the payment etiquette upfront and it will not be looked down upon if you do it too. Most importantly, this will ensure you’ll avoid being taken advantage of and discourage sloppy clients from doing business with you. We would definitely recommend you save yourself the unnecessary hassle.
Getting paid can sometimes be difficult, but as you start learning the ropes of freelancing it will get easier and easier with each client you deliver work for. Whether you’re a student, working full time, or are currently unemployed, becoming a freelancer can help you gain some additional income and create new avenues for your career to flourish in. The most difficult part is taking that first step. Always.
When it comes to how freelancers get paid, remember the points made above. Keep track of your work, break down your efforts and expenses, invoice all income you’re yet to receive, and remember that there are plenty of ways to set up your billing system. Ultimately, find a way that works for you. A bank transfer, PayPal, or standing order. The choice is yours.
Before You Go
Freelance marketplace: Revolancer