Time Tracking for Freelancers — A Simple Trick to Bill 25% More Time

It was October 2008. Fresh out of grad school, I was settling into my position at a marketing firm and wielding a freshly forged MA in English. (Oh, wait. That’s right… No one cared about my degree.) Time tracking for freelancers wasn’t even a twinkle in my eye.

In fact, I was in the throes of writing web content, formatting press releases, and adjusting to office snark and politics. To say that I was naive and lacked practical business experience would be like saying that ’90-’91 Michael Jordan could play basketball.

My First Experience with Time Tracking

To add insult to injury, the firm’s principal, my new BOSS, wanted me to TRACK my TIME. The nerve!

Accounting for all of my time in the office required me to pull cute, warm, fuzzy activities out of magic hat because I spent half of my time trying to make myself useful and the other half figuring out the task that had just been assigned to me:

“Hey, Austin, we need you to write down our branding strategy.”

“Okay. Who can tell me about it?”

“No one. We need you to make one up.”

“Okay. You want the newest guy at the company with no business or branding experience at all to write the branding strategy that we’ll then sell to clients?”

“Yes.”

“Sir, yessir.”

Different people define hell in different ways. I once would have defined it as my Research Methods class in undergrad: a class so dull I could feel myself leaking IQ. But no, hell was, in fact, opening up Clients & Profits and attempting to make fifteen-minute increments add up to eight or more hours.

clients and profits software

Accounting for my time seemed punitive after I had spent a slice of my one wild and precious life attempting the impossible: “jazzing up” and “spicing up” and “wordsmithing” the website of a local audio-visual installation company.

Six months later, when I got laid off from that job, I was thrilled to not have to track my time anymore. Good riddance! Time tracking, invoicing, and billing were for the birds.

Good news… It doesn’t have to suck.

Now, eight years later, I track my time. Carefully. With better tools.

You should too.

Consulting and freelancing represent a shift to a new form of professionalism. In a salary-based position or job with a set hourly rate, you clock in for the day, do work, and leave. You get paid whether or not you break down your whole workday into tasks, mostly because your employer trusts that you didn’t cruise Snapchat the entire day. As you satisfy the general requirements of the role, you keep getting paid.

But if you’re working by the contract, by the project, by the hour, you must spend each minute you bill on the tasks that create value for the client and move the project forward.

The exchange of value between bosses and employees is different than that of clients and freelancers. Particularly if you charge an hourly rate, the client trusts you to not waste her money and pad an invoice with extra time and irrelevant activities.

Time tracking is part of creating a positive experience for your clients.

Have you ever gotten a Comcast bill that seemed way too high? Did it raise your blood pressure? Did you mutter an expletive then pick up the phone to duke out the discrepancies yet again with a customer frustration specialist?

Consultants and freelancers itemize our invoices because we do not want to create that kind of experience for our clients.

They want to know what they paid for. They may be budgeting for different types of tasks — for example, research, copywriting, SEO) — and specificity enables them to evaluate the adequacy of their budgets and planning.

Are you billing your time in one amorphous lump like a professional employee? Or are you billing your time in task-specific fifteen-minute increments like a professional freelancers?

It helps you maximize your billable time.

If you’re not tracking time like a boss, then you won’t be your own boss for very long. At some point, you’ll get sick of juggling multiple client projects, tracking your time in an Excel spreadsheet, and bleeding time and money along the way. My advice to you is to increase your efficiency and professionalize before absolute chaos requires it.

Maximize your billable hours by re-capturing minutes spent answering emails, fielding phone calls, making tiny changes and updates to this or that project, and otherwise serving your clients.

If you currently aren’t lassoing those project management and admin tasks spread all across your day, then you’re probably losing 15–25% of your billable time.

Stop for a second: I’m not suggesting that you nickel-and-dime your clients. By all means, be generous with your time. But don’t mistake sloppiness in time management and billing as generosity. Generosity is doing what my web developer Greg did: We lost a WordPress install (not our fault) and had to use a backup to recreate it with a new hosting service. Greg knew this would kill my margin so he knocked $250 off of his invoice. Wow.

He had already won my loyalty, but his empathy and thoughtfulness make me want to send tons of business his way.

Right now, I use Harvest.

For time tracking, invoicing, and online payment processing, I use Harvest.

harvest app

Six Reasons Why Time Tracking Matters

Tracking time carefully accomplishes several things:

  1. You end up with a clear picture of how long tasks take. You can use this information to quote new projects more accurately in the future.
  2. You’ll eventually figure out how much time you need to allocate for various tasks and projects, and you can run a more efficient production schedule. A more efficient production schedule will result in higher profits and less anxiety.
  3. You can send your clients itemized invoices and earn more of their trust.
  4. Itemized invoices also help your clients with their own expense reports, budgeting, and planning.
  5. You can see where you’re wasting time: where you need to improve, optimize, and automate.
  6. You won’t blow scope. You’ll know when you’re getting close to the hours allotted, and you’ll either finish up quickly or go back and ask for more hours. If you charged a flat, per-project fee, you’ll eat the overage, learn your lesson, and figure out amore efficient workflow for next time.

For example, Harvest lets you set up recurring invoices. You can bill your retainer clients automatically each month. Uh… awesome.

No Kindergartner says, “I want to grow up and dice up my day in fifteen-minute chunks so that I don’t blow scope on a client project!” Tracking time is tedious.

That being said, by not tracking time and itemizing invoices, you present yourself as disorganized and naive. You shout through a megaphone, “Hey, I’m an amateur!”

What should you include in your invoices?

Speaking as a frequent hirer and herder of freelancers, I appreciate the following information in an invoice:

  • Date
  • Invoice Number
  • Freelancer/Business Name
  • Mailing Address
  • Phone Number
  • Email Address
  • My Name
  • My Business Name
  • Project Name
  • Task Name(s)
  • Tasks Note(s) — For example, “editing and proofreading Home, Services, About, and Portfolio pages for new website”
  • Subtotal(s)
  • Total
  • Due Date
  • Relevant Notes
  • Payment Terms
  • Preferred Payment Method(s) (Note: At least one of these should be a credit card for the sake of convenience.)

The invoice should be a PDF attached to the email, a PDF that a client can save to a folder or forward to a bookkeeper.

It doesn’t matter if you’re working on multiple projects for the same client. Send separate invoices for separate projects. That will help them with their accounting.

A Brief Tirade

I should not, I repeat, I should not, have to ask you for an invoice. Don’t you want to get friggin’ paid?! Why am I having to chase you down? I’ve got better things to do, and part of your responsibility — that is, if you want to succeed at freelancing — is to make your client’s life, my life, easier. For me to ask for or wait days or weeks for an invoice so that I can reconcile my cash on hand with accounts payable doesn’t leave me with a strong impression of your professionalism — quite the opposite.

Time Tracking for Freelancers

We all have to start somewhere, so take some advice from an old codger (I don’t have the Snapchat) and do yourself a favor:

  1. Pay for Harvest.
  2. Authorize your Paypal and Stripe accounts.
  3. Set up each client.
  4. Add a contact for each client.
  5. Create active projects for each client.
  6. Add billable tasks. Here are some of mine: Admin, Project Management, Meeting/Communication, Research, Copywriting, Editing & Proofreading, and Strategy.
  7. Download the mobile and desktop timers.
  8. Track your time.
  9. Invoice your clients and ask them to pay online.

In a future post, I’ll explain why I invoice for billable hours every two weeks and why you should too.

Time tracking for freelancers rant now concluded.

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Originally published at Austin L. Church.

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