How to make sure you’ll get paid on time for your freelance designer work

Being a freelance designer doesn't necessarily mean having an unstable finance situation. But many customers don't pay on time, and some may hurt your business. For you to achieve financial stability, we are sharing some precious actions that you ought to take, if you want to make sure that you'll always get paid.

Being a freelance designer doesn’t necessarily mean having an unstable finance situation. But many customers don’t pay on time, and some may hurt your business. For you to achieve financial stability, we are sharing some precious actions that you ought to take, if you want to make sure that you’ll always get paid.

Before you start a project, it’s smart to make things very clear to your customer. Good communication is the most important skill you will need to succeed.

Always follow these 7 essential commandments that professional freelance designers swear by.

1. Choose your clients carefully

Yes, we know that you have to pay your bills… But the fact is that if you take a bad customer, you’ll work a lot and still won’t have the money to cover your costs. But this is topic for another post (coming soon).

2. Have a contract signed by both parties that:

– Outline the project

Write down in details all the deliverables. For example: Say you’re commissioned to develop a non-responsive website, but your client still wants it to have social media sharing buttons. Be certain to specify it all on the contract. If then the client demands any feature that you did not agree on, after receiving the final product, you’re covered. Avoid yourself headaches.

– Explain your working process

Some clients might abuse their right to change the briefing, and could seem like they’ll will never be satisfied with your work. Then some might as well think that they don’t have to pay you. So, never forget to explain how’s your working process. Include exactly how many revisions you offer, and in which terms they will happen. This way you’ll be able to manage their expectations.

– Be clear about the guarantees

Try and make clear that due to the subjectiveness of any creative work, there is no guarantee that the final design will come out exactly as they had in mind. You’re not a 3D printer, after all. It’s worthy to insert a note mentioning that they chose you because they liked your portfolio, and your work will be based on the information they provide you (a great reminder of the importance of an on-point briefing). Inform them of your best intentions regarding their business and returns, but politely open up about the no-guarantees of you being able to match their vision precisely. And they should be ok knowing that they are hiring an artist. Yes, hollering at you!

3. Be very, very clear about everything that has to do with the payments

– Explicitly describe how and when the payments will occur. You can’t take home a new car before signing a contract and paying the first installment, can you? Sometimes projects have a long duration or take longer than expected. If you don’t receive some payment in advance, how are you going to pay your monthly bills?

– Divide the project cost into two parts: 33% or 50% down payment and the rest 14 days after delivering the project. This way the client will have enough time to prepare the final installment. Some customers refuse to pay in advance. In this case, work on a rough wireframe and present it. If the client still refuses to pay the first installment, go home and find a new client.

– Another great strategy is to add a 10% to 20% discount if paid in full at the time of signing (we prefer to call it a reduced fee). Getting paid in advance will enable you to better forecast your business income and have the peace of mind that your bills are paid so you can focus on what matters most: doing the best work you can.

4. Don’t forget to include the payment method

PayPal is a good way since it’s easy and instant(unless sending an eCheck). Moreover, many online invoice services integrate with the system, increasing the convenience factor. The only problem with PayPal is that it’s expensive. You will have a cut between 3.5% and 4% on your revenue.

TIP: when calculating the project cost, remember to include Paypal’s fees.

– Check is an alternative because most banks won’t charge extra fees.

– Bank transfer is another good method. Usually is convenient for both parties as nowadays most people are comfortable with online banking. The bank transfer usually costs for both the sender and the recipient. The cost varies from bank to bank, and also depends on whether it is local or international transfer. For international transfers, an excellent service is TransferWise, that charges low fees.

5. Write an effective Invoice

Your invoice should specify a 5% to 10% penalty for late payments. If you don’t get paid on time, at least you can amortize some losses.

6. Send reminders

Even good customers forget to pay; they have other things to do, other bills to pay and like everyone else, they can forget.

– Send a reminder three days before payment.

– After one week, if you haven’t gotten paid or didn’t get any word from the client, send a friendly reminder.

– Two weeks after, send another reminder and call the customer.

– After a month, you should start to worry. Call a lawyer. Don’t have one? Consider hiring one, as every freelancer should have a lawyer. Unfortunately, for some people, one thing is having a freelancer asking for his money. Another is a lawyer demanding his client’s payment. Most people will understand you’re not joking, and pay you. Oh, humans.

TIP: If a lawyer is out-of-budget for you, join a union or a local design association – probably you can find cheaper help.

And last but not least,

7. Get paid on time or… be prepared for the injury:

Did you know that retailers, banks and other sectors of the economy, include a fee on the price of their products to cover possible losses caused by various unforeseen events, including defaults?

You should do the same to avoid injuries.

Oh, and by now you should be needing some music to help you work happily and be more productive, right? We curated this special playlist so you only have to press play.

Being a designer doesn't necessarily mean having an unstable finance situation. Always get paid, and get paid on time with this Designer's Business Guide.