One of the biggest headaches that freelancers have to do with is figuring out payment options. How should you get paid by your clients? What if they are international? What about payment services, accounting software, rush payments, PayPal, bank or wire transfers, the list goes on!
Even though being self-employed can be pretty exciting (and fun) at times, dealing with payments is one of the most stressful aspects of running a business for many.
That’s what we’re here to try and make things simple. In this blog, we’ll dive into the kinds of payments freelancers receive, your potential best payment options and payment methods, what you need to know about processing payments online, and more.
If you want to say goodbye to billing headaches, read on for more info.
Start with the basics: freelance accounting software
Accounting software for the self-employed is a must for anyone starting out in the freelance world. After all, even if you don’t exactly like it, everyone must track their earnings and report them to the government.
The easiest and most efficient way to do this is with accounting software, many of which are made specifically for freelancers/self-employed people. Some of them are even free.
Which software you’ll use depends on what your needs are. Some of the top software brands today are QuickBooks, FreshBooks and Wave
While investing in accounting software may seem over the top when you’re just getting started, start small (even with something free) to make sure that you remain organized. That way you’ll make sure that you don’t miss payments from any customers and when tax season rolls around, you’ll be ready to go.
What is the easiest payment mode for freelancers?
There’s no right or wrong answer to how freelancers should receive payments. There are various freelance payment methods that may depend on the field, type of billing, international vs. domestic payments, currency and more.
One thing is clear: collecting payments today should not be difficult for any freelancer.
Here are a few of our favorite options for collecting payments:
- PayPal - Set up a PayPal account and start collecting payments easily from anywhere in the world. The benefit of PayPal is that you can see the transfer instantly in your account and charge any currency that you desire. Clients and customers are also likely to trust PayPal and may find it easy to use. The downside is that PayPal fees can add up quickly, especially when we’re talking about international payments.
- Wire transfer/bank transfer - Receiving payment through wire transfer or bank transfer is another secure way to transfer payment. In this case, the processing time may range and take multiple business days, but the money will be deposited straight into your bank account. Fees for these transfers vary widely and should be checked before moving forward with this method.
- Credit card processing - Credit card payments are a prefered method of payment for many people today for various reasons. Credit card processing is easy, in certain cases gives you points to use on airlines or other places of choice, it’s secure, etc. For freelancers, credit cards may be a good option but it is important to do your research regarding fees per transaction. Once you decide on a credit card processing platform, make sure to check which kinds of credit cards it accepts as well as debit cards. All of this information will be helpful when working with your clients. If you prefer, you can embed your processing in your website, or you can manually accept credit cards and enter their number on your computer or phone app. The options are almost limitless!
- Marketplaces and networks - Some freelancers prefer to work through online marketplaces such as Fiverr or Upwork. While these sites take a percentage of your income, they also make the billing process much easier (as well as the process of finding clients). Your clients will deal with billing straight through the marketplace and you’ll receive the payment without doing anything (besides the work of course!).
Is receiving payment as a freelancer online safe?
As with anything else in the online world, as a freelancer, you need to be careful about the ways that you will receive payments.
Using some of the acceptable methods that we discussed above can be safe for both you and your clients. As always, you’ll need to use caution for example if you accept a credit number, to dispose of it safely when finished. This is why we recommend using established payment methods that will leave both sides feeling safe.
Get set up to accept online payments today
After you’ve landed your first clients (congrats!), it’s time to make sure that your billing methods and software are in line. While payment processing and platforms may seem confusing at first, you’ll get the hang of things quickly and hopefully start accepting payments on a regular basis.