All freelancers deal with invoicing—it’s just part of the business. What you may not realize is just how much you’re invoicing says to your clients about you and your work as a freelancer.
Establishing a healthy freelance routine should include healthy invoicing habits. In fact, since invoices control how and when you make money, getting in the habit of proper invoicing should be at the forefront of your business strategy.
Like all habits, the best time to make changes to your invoicing procedures is right now. And the first step to improving is identifying problem areas—check out these five habits I’ve identified and see how you stack up.
1. You Send a Sloppy or Unclear Invoice
Sending an invoice that isn’t succinct and easy-to-understand says that you lack attention to detail—which could be a huge red flag for your client.
Naturally, they may even start to wonder if your sloppiness translates into other areas of your business—maybe even that next project they were thinking about hiring you for.
To address this issue, try using a professional invoicing app like AND.CO to make your invoices more clear and professional.
Using a pro tool instead of freebies like Google Docs is a leap for some freelancers who are tight on cash. But think about it this way: as a freelancer, your time is the most valuable part of your business.
Using invoicing software will allow you to spend more of that time on billable work instead of chasing down past-due invoices.
Good invoicing software can also provide better data security, payment tracking, and perks like automatic client followup.
Really, the best benefit of using software to generate a clean, easy-to-read invoice is it gets you back to the creative tasks you love instead of the administrative work you despise.
If an all-inclusive tool isn’t the best fit for your business, you could also hire someone to design a professional invoice template for you to use over and over again. There are lots of great designers who are ready to help you in the Fiverr marketplace.
2. You Invoice at the Beginning of a Project, Not the End.
Invoicing upon the completion of a project is standard procedure, right? Not always.
Brands that sell physical products online usually charge when the item is shipped, not when it’s received. And many suppliers are paid in advance so they can produce the work required.
Why should your freelance services be different?
Sending your invoice when you start a project says that you are confident about the value you bring to your client’s business. As soon as they see your bill hit their inbox, they’ll assume you plan to meet deadlines and present a well-polished project.
Which, of course, you will.
Billing upfront also puts you on equal footing with your client, so you’re seen as their partner, not a servant or tradesperson. This style of invoicing helps both of you view your interactions as more of a partnership, which leads to more positive client interactions and even higher pay.
Best of all, giving the client a heads up as you start work puts your project in their budget for the current month.
Even if you don’t receive payment until the work is completed, billing ahead helps you avoid past-due invoices. Many clients appreciate paying upfront so they don’t have to be reminded later when they’ve spent their budgets for the month or quarter.
3. You Never Follow-up on Overdue Invoices.
Speaking of past-due invoices, how you handle missed payments says a lot about you as a freelancer.
If you don’t have consistent procedures in place for tracking and collecting payments, clients may assume you don’t care about getting paid.
Which means you’ll find your invoices falling to the bottom of the pile every time.
If you haven’t encountered an overdue invoice in your career, odds are you will. In the UK last year, the Association of Independent Professionals and the Self-Employed (IPSE) estimated that freelancers spent an average of 20 days each year chasing late payments.
That’s something like 160 hours a year you could be spending on other projects, being with family, or taking a much-needed break.
The problem is, who has time to develop and follow through on detailed invoicing procedures?
Here’s where an invoice tracking software made especially for freelancers can do a lot of heavy lifting. Using automated tools to remind clients about invoices that haven’t been paid not only saves you time, it makes it less awkward trying to chase payments down.
4. You Itemize Every Little Thing You Did
Sending a complicated invoice with lines for each hour you worked, detailing exactly what happened and when really isn’t necessary.
This all-too-common kind of invoice says that you see yourself as more of a day laborer than a true professional partner.
While an invoice absolutely must be clear about what clients are paying for (see habit #1), adding a ton of information does not accomplish that goal.
In fact, listing too many details might lead your clients to question every line item, scrutinizing the cost and wondering how they can save money next time.
Not what you want.
You should have already agreed on a total project or hourly cost and the final deliverables back when you sent your proposal. So there is no reason to justify your time, especially if you’re within the original budget.
On invoices, itemize big-ticket items only. Keep detailed reports saved elsewhere in case of disputes.
5. You Fail to Include Important Details or Terms
Once it is agreed to by both parties, an invoice is a legal document. So leaving off key things shows that you don’t understand what it takes to get an invoice paid on time.
Honestly, a less-than-professional invoice says that YOU are less-than-professional yourself.
On the other hand, including things like the original payment terms, details of where to send a check or money transfer, a due date, and other crucial information will ensure you’re paid on time without back-and-forth. This helps you look like the professional you are.
Investing time into learning how to write an invoice that includes all the correct information can pay off big time in the long run.
Paying Attention to Your Invoicing Habits
As best-selling author James Clear put it, “your life today is essentially the sum of your habits.”
Good habits are good for your business.
That may be no truer in any other area of your business than when it comes to invoicing.
If you can get in the habit of sending clear, quality invoices and following up, you’ll appear more professional, save time and effort in your freelance business, and get paid on-time more often.
You deserve that much from your clients.