Getting Payment Before Starting a Project

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Categories: Accounting, Business, Freelancing

Getting Payment Up-front

I’m always reading stories of people not getting paid for their work. When you’re just starting out on your own, this can really hurt you mentally and financially.  The solution is fairly simple though. You should always have a contract and some up-front payment before you start a project.  In some cases, an up-front payment is more important than a contract.  A contract is vital, but nothing says commitment more than money.

Typically, the initial payment is somewhere between 25% to 50% of the total project investment.  What I expect is based on total investment amount and the time it will take to complete the work.  For large projects, I break the payment into thirds or fourths.  For smaller projects, it is 50%.

I learned the importance of contracts and up-front payments the hard way a few times early in my career.  Unfortunately, I was burned by this recently as well…

When a client is ready and willing to write you a check to get started, you know you’re working with somebody that understands business, understands the value of your time and wants the work to get completed.  If the client isn’t ready or unwilling to write a check (or swipe their card), you should be questioning their commitment to the project.  On a few occasions early in my career, I either needed the work and/or was so excited to get started I didn’t ask for an up-front payment.  I got burned when the client backed out of the project.

I was also burned by this recently when I didn’t prepare a contract or ask for up-front money from a long standing client.  I wrongly assumed that our past relationship combined with the small value of the project negated the need for a contract and up-front payment.  Things didn’t work out and I was out the entire project amount.  Besides my obvious mistakes, I learned that when the client has nothing to loose, they are much less willing to work with you when disagreements occur.

Having a contract in place is great if you’re willing and able to get a lawyer to enforce it.  Having money in the bank is even better.

It doesn’t matter who the client is, how big the project is or how much you need/want the work, get a signed contact and more importantly, an up-front payment before you start.  Besides saving you a few headaches, it tells the client you’re a professional and take your business and their business seriously.

This topic was taken for our free 101 Simple Freelancing Tips download.  If you haven’t already downloaded it, get our copy today.

Written by Brett Atkin

I have been building and maintaining web sites since 1997. I remember when Netscape was the top browser and PointCast was the news service of choice. The web and I have come a long way in the last 13 years. In those 13 years, I’ve built everything from brochureware sites, custom CMS’s using both ASP and PHP to fully responsive Wordpress sites. I’ve helped clients with their blogging, email marketing, online promotions, SEO and Analytics.

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