There comes a time in many freelancers’ careers when they consider asking for a deposit upfront. Some are hesitant to do so, fearing it’ll put off potential clients. However, getting money upfront has its benefits.
The best reason to get a deposit is so you’ve got some insurance in case the client does a runner or refuses to pay. While it might seem like a rarity, clients disappearing without paying is actually pretty common.
There may be disagreements, misunderstandings or the client may have had no intention of paying in the first place.
While a deposit won’t make it sting any less, it will be something at least so you’re not missing out 100%.
Filter out clients
Asking for a deposit will filter out the people who have no intention of paying. One way to tell whether they’re looking for free work is to ask for a deposit first.
If they try and get out of it or are a bit vague when the topic of payment comes up, they might not have even factored you into their budget. Steer clear of these clients!
How much to ask for
If you’ve decided to ask for a deposit in the future your next question might be how much to ask for. There’s no rule really. Some will ask for 10% of the final fee, others will ask for 50%.
Those who ask for more usually have a lot of experience and a solid reputation. Freelancers starting out will struggle to sign anyone on if they’re expecting 50% upfront because they don’t have the experience or authority in the industry yet.
Sticking with your decisions
Some clients will try to talk you down. It’s up to you whether you let them. Just know that if you do it once, you’ll probably do it again. Plus if the client intends to pay you your fee, you should ask yourself why they’re trying to get out of paying a deposit.
When should you ask for a deposit?
Many freelancers will only ask for a deposit with new clients so they’ve got a chance to experience the working relationship first. We’re not suggesting asking for a deposit every time a client wants new work if it’s too disruptive but that’s up to you and your personal circumstances.
Other freelancers will make it a policy of theirs to always ask for deposits for long-term projects. Long term projects could mean going a long time before getting any money, not ideal if you’ve not got much work coming in.
Other ways to protect yourself
Another way to protect your interests is to have late payment terms. Plenty of freelancers state in their contracts that there will be a fee for late payment. This will hopefully deter clients from paying late or will filter out those who will anyway. If not, you are somewhat compensated for your wait.
Do you ask for a deposit upfront? Have you ever had a client disappear without paying? Please share your thoughts in the comments.