A freelance career can sound a lot like the ultimate fantasy. It’s important to remember, however, that a good fantasy still has some conflict in it: the freelance landscape can get rough, and you’re going to have to find ways that help you maintain your ideal lifestyle.
First, there’s the glittering prospect of flexible hours:
Impromptu potential client meeting? “No problem! I’ll just finish this when I get back!”
Then, you’ve got the magical fact that you can work from home if you want to:
Can’t find your good work slacks? “Who cares? I don’t even have to wear pants!”
And you can’t forget the shiny realization that you can be your own boss:
You really want a new desk chair, but… “But what? New desk chair, party of ME!”
Basically, it sounds like frolicking through a meadow full of “doing what you love,” “following your passion,” and a whole bunch of unicorns… which is what we’re all looking for, right?
While all of these scenarios are completely viable, there are some other very real possibilities that might not be so enchanting. One of those being the chance of your biggest client having a dry month…meaning they can’t “make it rain” business in your direction.
What this translates to is a lot of waiting around and stress on your part, wondering when new work will come in, and when you’re going to have enough money to buy peanut butter.
In this case,
What exactly is a retainer agreement, and why would you want one?
Much like a medieval protector, a retainer agreement offers security and peace of mind.
Basically, your client will pay you a set amount of money each month, and you will provide them with your services as they need them. This can be a fantastic setup for a number of reasons, the most obvious one being financial stability for you.
Choosing to set up a retainer agreement with a client provides a clear payment time frame that eliminates the wondering/waiting phase that can come with freelancing. The client will pay you on the agreed date, and you suddenly have the ability to create some financial plans based around scheduled payments. Generally, this isn’t the norm in freelancing, and can be a great step on the way to making your freelance fantasy a reality.
There are a few steps to take, however, before you snag a retainer agreement template and start offering one to all of your clients.
Is this decision even right for your current contracts?
When is a retainer agreement a good idea?
Not everyone appreciates being swept off their feet with new ideas and promises of commitment.
Many of the people you work with will likely be happy with their current setup with you, and won’t want to change things up.
There are certain clients, though, who are perfect candidates for a retainer agreement. Freelancers tend to have a mix of clients, but there are some who are better than others. Those who provide you with a steady stream of projects on a regular basis, pay on-time, and greatly appreciate the work you do are ideal. The plus for you is a steady, dependable stream of income while the plus for them is the potential to get a little more bang for their buck. If they’re paying $1500 per job, the prospect of a flat rate can be incredibly appealing, but you’ve got to get them on board first.
This is when you’ve got to sprinkle some magic dust onto that client proposal.
Although it’s usually a good bet for a company, a retainer can seem like an intimidating commitment. A flat rate? What if they don’t need you as much next month? Dependability is nice, but wasting money is not.
Three things you can do to alleviate concerns are:
-Offer commitment choices. Letting the client choose the length of the commitment will help them regain a sense of control. Giving them a few retainer options, such as three months, six months, 12 months, will give them a little peace of mind. For you, however, the longer the contract, the better. Make sure to point out the value of being able to monitor and adapt progress over a longer period of time.
-Remind the client of your value. If you’re going to propose a retainer agreement, it’s hopefully going to be with one of your best clients. Tactfully highlighting the positive traits (such as dependability, punctuality, noticeable results) you’ve displayed during your working relationship can be an effective motivator.
-Highlight the importance of your availability. The idea of paying someone for nothing isn’t all that appealing, so you need to make sure the client is aware that the retainer promises your availability. While this doesn’t mean you’ll be at their beck-and-call (that would not bode well for you), it does mean that you are ensuring them high priority and fast turnaround. Being on a top-priority list is an appealing prospect (especially if it’s ever been an issue in the past).
What should you include in your retainer agreement?
If you want to make sure you’re truly protected, you can’t forget that shining armor.
One of the most important parts of up-keeping your ideal freelance fantasy is to make sure you get paid. Skipping lunch all week because you’re out of money is not the shimmery ideal. You need to line your shield and helmet with some paperwork.
You’ve got a lot of options for this. You can contact an attorney, try to find a good sample retainer agreement to emulate, or find a template to fill out and customize for your needs. Regardless of how you build it, you need to make sure the retainer agreement example you use includes a few key points:
-Be extra clear about the amount of work you will provide.
Do you usually charge this client on an hourly basis? Do you charge by the project? Since a retainer can seem like a big change to your client, it’s a good idea to stick to your normal charging methods. Whichever method you choose, however, you’ve got to make sure you’re specific about the amount of work that you will provide for this flat rate. 25 hours per month, tops? Two projects, with two revisions each?
This will ensure that the agreement is beneficial to you, and will eliminate scope creep.
-Talk about payment.
When will you invoice each month, and when will you expect payment? Be very clear about this. Include specific dates and amounts of money, leaving no question of how many dollars you’ll have in your bank account when it’s time to pay rent..
It’s entirely possible that you or your client might decide this retainer isn’t going to work. Including the process that will be used when ending the agreement can potentially rescue you both from bad feelings once it’s all said and done. How much notice do you need? Do you feel like a refund should be issued? Buyout?
How much time do you need to work on projects? If you work on a project-basis, spell out to the client how much time you will need to get an assignment done. For instance, if they called and requested a project on the last day of the month, would you be able to provide a finished product to them by midnight?
This isn’t required, but can be incredibly helpful in easing your client’s mind. Including a weekly or bi-monthly progress discussion with the client will help you monitor their feelings on your work and the new configuration. Keeping your clients happy is the goal, right? This is a great way to keep your quality and their mood in check.
A few tips:
-Include information on extra work. What happens if the client needs more work than agreed upon? How will you deal with invoicing?
-Consider lowering your rates a little to sweeten the deal. Figuring out your minimum rates will give you a good idea of how low you can or cannot go.
-Make it official and have both of you sign the agreement. Whether it’s actual pens and actual paper, or an eSignature on a digital contract, you’ll both be protected.
-Track your time, even if you charge by the project. Keeping in mind how much work you’re actually doing will show you if you need to change a few things in the next retainer agreement you work up.
-If you promise your client your availability, you’ve got to keep yourself available to them. Bear in mind that, the more clients you get on retainer, the fewer hours you’re going to have to use as you choose.
By obtaining a retainer agreement, you can eliminate the financial uncertainty that usually comes with a freelance career. Getting all of those details in (in an aesthetically pleasing format) can be a little intimidating, so we’ve created this handy retainer agreement template for you to use and customize for your business needs.
Sure, the perfect freelance career might not exist. But your fantasy can come true in the form of a fulfilling freelance career. You can start by using our retainer agreement template to turn “once upon a cubicle” into “happily (self-employed) ever after.”