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Freelancers: When to Ask for Money Up Front

Getting paid is one of the biggest concerns that many freelancers have. We do work in good faith, expecting to receive compensation for our efforts. However, not everyone behaves with integrity. Most of us have been stiffed at one time or another, and it makes us a little nervous for the next job.

There are times when you can ask for money up front, though. While you might not always get away with it, here are some ideas for getting paid (at least some of what you’re owed) ahead of time:

Large Projects = Incremental, Upfront Payment

When I’m involved with a large project, like ghostwriting a book, I break down the charges into increments, with each section of the job paid for in advance. One of the things I find as I manage projects like this is that I can usually break the work into three to four segments, and charge up front for each section. If a project will cost $15,000, I’ll ask for $5,000 up front. Then, the next $5,000 is billed for when I complete 1/3 of the project, with the final $5,000 ready when I get 2/3 of the way through.

In some cases, clients are wary of making the final payment before they get the completed product. If this is the case, I sometimes allow them to make the final payment at the end of the project. By then, the fact that I ask for money up front has already benefitted me, in that I have received most of the payment already, and the loss isn’t as great.

Anytime you are working on a major project, break it down. It makes it easier for the client to pay, and it can help you receive money as you go along.

Ask for a Deposit

Another way to ask for money up front is to get a deposit. With a medium-sized project, it can make sense to ask for half of the money up front, and then ask for the rest at the end of the project. Getting some of the money at the beginning is a good idea because it means that you know that you will at least receive something for your work. Even if the client welches on the last bit of the money, at least you aren’t completely out. (When setting rates for medium to large projects, I sometimes quote half again what I want to receive so that I don’t lose out too much if the client is slow in paying, or doesn’t make the final payment.)

Work on Retainer

We often hear about lawyers working on retainer, but did you know that freelancers can work on this basis as well? I have a couple of clients that pay me up front, for the work to be done in the coming month. They pay me on retainer, with the same amount of money each month. It’s understood that I will do certain tasks each month, including providing some content, doing a little editing, and sharing on social media.  As long as I meet my obligations, the clients are fine with paying me on retainer, ahead of time.

As you consider your bigger projects, make it a point to consider how you can ask for money up front. We pay for goods all the time without seeing them first or trying them out. There’s no reason that your product can’t be paid for ahead of time as well.

Credit Expert
I’m Miranda and I’m a freelance financial journalist and money expert. My specialties are investing, small business/entrepreneurship and personal finance. The journey to business success and financial freedom is best undertaken with fellow travelers.

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