The financial instability of freelancing can be more difficult than working a 9-to-5 job - clients sometimes don't pay on time, or they disappear when bills are due. To achieve success as a freelancer, it's crucial to receive upfront payments to ensure your cash flow stays stable so you can cover project expenses.

In some cases, clients might not wish to pay upfront, especially if it is the first time they are dealing with you. There are a number of ways, however, you can motivate them to follow through. The upfront payment does not necessarily have to cover the entire fee. We'll discuss tips on how to get paid up front, but let's define what an upfront payment is first.

What is an upfront payment?

Upfront payment can be considered a deposit. For example, it can be 20% of the project cost or the full project cost. The client pays it before you begin the project in both cases. Payment in advance can be requested before the project starts or whenever a milestone has been completed and work is about to begin on the next one.

1. Create a good contract

You should collaborate with a law firm to create a contract that you can send to clients before you begin working with them. Making sure you specify how the work is performed, when the payments are made, and when the client receives a refund is a key to protecting your interests.

Generally, freelancers avoid signing contracts as they want to start working immediately so that they can get paid sooner. You might not receive payment from your clients without a good contract. This is why it is so important to have some kind of contract (even the simplest).

It is a good idea to outline the main points you want to include in the contract before you hire a lawyer to draft it for you. Be sure to mention upfront payments - the dates for payments, how they must be sent, and when they may be returned (refunded).

2. Set up recurring invoices

Utilize invoicing software if you have retained clients and you need to send recurring invoices on a monthly or quarterly basis (depending on your agreement with the client). Automating the creation of similar invoices to those that you have created in the past, and sending them to clients, will make your life easier.

In addition, you don't have to worry about creating invoices because the software makes them for you and sends them directly to your client on your behalf. 

3. Offer a Money-Back Guarantee

One of the major reasons clients don't like paying upfront is the fear that the freelancer won't deliver the requested service on time or will not satisfy their needs. In order to overcome this fear, you can offer a money-back guarantee.

Be sure to specify the exact circumstances under which funds can be refunded. The money should be kept if there are only a few minor mistakes in a project that can be corrected. Only offer a money-back guarantee, if your client is dissatisfied with the results, and there is no way to change them or improve them.

4. Use Escrow Services

A service like escrow allows clients to pay you upfront more comfortably. Escrow services hold the funds for you on behalf of your clients and release them only once you have reached the milestones dictated in your contract. Although your client retains control over when payments are made, the transfer of funds is guaranteed when the quality work that you promise is delivered. This gives you a sense of security, which can help you focus on the project (rather than worrying about whether you'll get paid).

Digital escrow services are offered by many companies in India. Among the most trusted is Vouch.

5. Last resort

In the event that your clients refuse to pay you upfront, no matter what incentives you offer them, how would you handle that? Do not lose hope! In the case that you have just started working with a client and haven't gained their trust, ensure that your first project meets the client's requirements.

For example, if you need to buy materials or apps, or software and your clients don't agree to pay upfront, you should add a small amount to your final invoice to account for any costs associated with borrowing money.

Also Check: How to set the payment milestones on Vouch?

Wrapping up

It is beneficial for freelancers to get paid upfront because it helps keep their cash flow stable, and they avoid situations where clients run away without paying them after the project is complete. Moreover, getting paid upfront gives you some sense of security (instead of worrying about not being paid). Nevertheless, clients may not always pay upfront.

It is your responsibility as a freelancer to create the right incentives for clients to pay you before the project is complete. You should not give up if they do not work for you for any reason!


Check back here to learn more about working as a freelancer and how to protect yourself from fraud.