This is presumably relatable to almost all freelancers working in any field: we put in all the work and effort to offer the ultimate product and services for our clients, issue them an invoice, then we anticipate that the payment process will be smooth and problem-free. Unfortunately, the reality is often contrary to our expectations. You may be thinking, “But how do I invoice as a freelancer?”The problem is that an ideal situation hardly ever materializes. More often than not freelancers face all sorts of issues related to invoices: late payments, accounting mistakes, disagreements concerning the pricing and methods of payment–you name it. If there is one problem that we don’t pay enough attention to in freelancing, it is billing and payments; namely, freelance invoices. In today’s article, we will dive deep into the world of freelance invoices and how to handle disputes over invoices such as payment terms of freelance invoices, and other types of disputes such as deadlines and accounting problems.
Why clients forget or delay invoice payments
There are many reasons why freelance invoices are forgotten or delayed, and trust us, not all of these reasons are caused by the ill-will of the counterparty. Most of the time, the reason why an invoice is forgotten or delayed is because there is either missing information concerning bank details or personal information. Other times, an invoice can be delayed simply out of confusion or other errors within the invoice itself. If you wonder how to create a flawless freelance invoice or how to invoice your clients properly as a freelancer, we strongly suggest you keep these points in mind in order to prevent future mistakes.To summarize, here are top reasons why clients forget or delay the payment of freelance invoices:
- Faulty or missing information (personal or professional)
- Problems concerning payment methods
- Errors in issue and due dates
- Mistakes concerning pricing
- Miscommunication
Accounting mistakes
The bundle of accounting mistakes is a diverse one where there are multiple types of mistakes one can make or multiple pitfalls one can fall into. The most common accounting mistakes that freelancers make are:
- Forgetting to put an invoice number or putting it falsely
- Misrepresenting the total amount due
- The disparity between an agreed deadline and the deadline on the invoice
- Mistakes concerning terms of payment, extra fees and transaction
Issuing the invoice incorrectly
This tip may sound redundant to many of us who may think that sending our freelance invoice to the right person goes without saying. But the truth is, it is actually possible to send the wrong invoice to the wrong person with faulty details in a scenario where we work with many clients on many projects over varying periods.Suppose you are going through a phase in your professional life where you have more projects than enough on your plate. The more you work on similar content, the more likely it'll be that you take one project and the client for the other. This is where we make the most unlikely mistakes and send an improper invoice to a client or one of your invoices reach the wrong client.The best way to avoid an unwanted situation as such is to stop doing invoicing manually. Handling invoicing with the support of a digital invoicing partner such as Ruul diminishes any type of misinformation in your invoice documents. Since your client information is double checked on Ruul’s system, you prevent both documentation and recipient errors by handing over the invoicing process to a trustworthy third party.
Quality issues
Maybe your template is a bit hard to navigate, maybe the terms of the agreements don’t follow the conventional lingo of freelance invoices, maybe the information on your invoice isn't listed in a convenient way and your clients have to scroll up and down between sections to find what they are looking for.We can consider such issues and misunderstandings as quality issues. These factors and others bring up question marks and doubts in the minds of our clients, discourage them to pay the necessary attention to the invoice that we sent and eventually delay the necessary transaction.
Pricing or payment disagreements
Disagreements related to pricing and payment are the most common ones that can take place between freelancers and their clients. Such disagreements delay the agreed transaction and they are likely to cause friction between a freelancer and a client. This is where clear communication, signing a service agreement with your clients in advance and paying attention to prepare a neat invoice complete each other in avoiding such friction.
What should you do to prevent invoice disputes?
Since we talked about all the possible pitfalls, complications and their potential reasons, now we can start talking about how to prevent them and how to start issuing better freelance invoices. Below, we will elaborate some of the points listed below so that you can prevent future disputes over invoices:
- Start small
- Work with clients through referrals
- Agree on payment terms before the project begins
- Communicate clearly and keep a record of your communications
- Try getting upfront payments
- Use Ruul for your invoices and to keep track of them
Start off with a smaller scope of work
It is common to start your freelancing career with one or two clients and have multiple ones, usually through your network, in the course of a couple of months. While it clearly signifies that things are going alright with your freelance business, it also signifies that each client means new responsibilities, terms to obey, invoices to issue and deadlines to follow.If you are new in freelancing it is completely okay to forego some projects and focus on quality over quantity. Over time, you can start accepting more projects and complete more tasks as you feel more comfortable with the work that you perform and the way you handle your interaction with your clients.Keep in mind that the better you get at your profession, the more people will realize it and come to you for getting tasks done. Preferring quality over quantity is one of the best strategies you can adopt in your career.
Work with clients that you know through referrals
When it comes to avoiding invoice disputes, referrals work as our safety net. Working with people that we know through mutual contacts or a referral will save you a lot of trouble. In such situations, referrals function as a frame of reference and save us a lot of time and energy that we would otherwise have to spend on establishing a bond of mutual trust and a common basis for working together with total strangers.
Agree on terms of payment before the freelance project begins
Will your freelancer invoice include a late fee, will there be an upfront payment, what is the exact price per item, does the figure on the invoice indicate a pre or post-tax amount? All of these questions have to be settled and answered between two parties before the project begins. This may be one of the most important, if not the most important, points to emphasize.Once both you and your client agree on such terms then you can confidently back your claims up in case of a possible dispute or a disagreement. Not only is a clear pre-agreement of payment terms the solution to many of your invoicing problems, but also it is a clear demonstration of your professionalism–something that your clients will surely appreciate!
Communicate clearly via email
The correspondence between you and your client should be as clear as day. It should cover all the crucial aspects and it should ideally be carried out via email. Even though you and your clients can prefer other mediums of communication such as texting or calling, nothing is as convenient, reliable and practical as using emails.
Encourage upfront payments
Currently, there is an ongoing debate within the freelancing community about the percentage or the amount of upfront payments. Some people say freelancers should charge 10% upfront payment, others claim it should be 20%. Depending on the quality and the scope of the project, some others believe that freelancers should charge a higher percentage of upfront payments to secure the sustainability and the well-being of the entire operation.Leaving the amount of upfront payments aside, there is one matter on which almost everyone agrees and that is the necessity to charge an upfront payment before the project. Upfront payments make clients comprehend that you are a professional and they help with the resolution of invoice disputes.
Use Ruul to invoice, and keep track and collect payments
Starting from day zero, Ruul supplies the proper instruments of freelance invoicing and invoice tracking. It is surely the ideal option for freelancers wanting to give a more professional structure to their operations. With basically free-of-charge starting and maintenance options at the beginning, you can use the fee calculator to figure out the net amount you will receive.With rich preferences in global currencies and banking selections, you can offer your client the payout alternative that will suit them the best, which definitely smoothes the process of payment collection for both parties. and avoid the laborious calculation processes.
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