Deposits
A deposit is part of the project price, paid before work starts. It confirms the client is committed, covers your early costs, and holds a place in your calendar.
- How much: 25% to 50% is common; 100% up front for small jobs or new clients is reasonable too.
- When: on acceptance of the estimate, with work starting once it's paid.
- Afterward: credit the deposit on the next invoice, so the client pays the balance.
- If the project is canceled: say in the agreement whether the deposit is refundable, and for which work.
Monthly Retainers
A retainer is a fixed fee each month for ongoing work, billed at the start of the month. The most common kind covers a set number of hours:
| Amount | |
|---|---|
| Monthly retainer: 30 hours at $100 per hour | $3,000.00 |
| Hours worked in October | 34 |
| Overage: 4 hours at $100 per hour, on November's invoice | $400.00 |
Some freelancers give a small discount in exchange for the commitment, such as 30 hours for $2,850 instead of $3,000.
Unused Hours
Decide up front what happens to hours the client doesn't use, and write it in the agreement. The usual choices:
- They expire at the end of the month. Simple, and it fits a retainer that reserves your time.
- They roll over for one month, then expire.
- They roll over with a cap, such as 10 hours at most.
What the Agreement Should Say
- The monthly fee, the hours it covers and the rate for extra hours.
- What kinds of work are included, and how requests come in.
- Unused hours: expire or roll over.
- When it's billed and when it's due.
- Notice to end it, often 30 days.