It’s common, when you start freelancing, to invoice using software you’re already familiar with. Many beginner freelancers use Adobe’s Creative Suite, Microsoft Word, or even Excel to generate their invoices.
In the heat of the moment, you’ve landed a gig, set your price, and it’s time to send the invoice. It’s easy to understand why you’d grab software you’re already familiar with but you may be setting yourself up for failure in the long term.
Heavy up-front cost
Many freelancers decide to manually create their own invoices to save time. Unfortunately, little time is saved by generating your own invoices, in fact you may find that it takes significantly more time to generate your own invoices. Finding, designing, and tweaking your template can take hours. It’s a common misconception that invoicing software is complicated or extremely time consuming to setup.
Optimizing and properly managing your time is critical as a freelancer. Time spent deviating from your core work is costly. Any extra time you spend invoicing is time you could be billable, doing the work you’re passionate about. Time you save using faster invoicing solutions could also be used to find new opportunities and build your pipeline of upcoming work.
Hard to develop and maintain a system
It can be difficult to develop a system that works for you and your business without it being a major time sink. How are you going to organize the files that you created in a way that you can easily reference them when payments or taxes are due? Many resort to elaborate naming schemes and folder structures. Furthermore, determining what invoices have been paid can be difficult, requiring a separate “master” document.
Danger of overwriting or deleting important records
It’s critical to keep regular back-up intervals. Hard drive failures or equipment loss can crush a small business or freelancer. You have to make sure your financial documents are safe and secure from external forces. In my case, you also have to protect them from yourself! Before I was using an invoice system, I would open the last invoice I sent, make the necessary edits for a new invoice and then often accidentally save over the old invoice! This bit me more than a few times. I’d have to dig through my outbox to find the original copy and replace it on my hard drive.
Difficult to get paid
It’s hard enough chasing payments when there is zero friction. The last thing you want to do is make your client uncomfortable or inconvenience them. When you’re rocking your own system, you’ve got the burden of ensuring you’ve sent your invoice in a format your client can open. You’ll probably want to generate a PDF to send the client while maintaining your own editable copy. You just doubled your records per invoice. Aside from getting the invoice to the client, how are they going to pay you? Many clients, particularly small businesses, prefer to pay via credit card. As you’re probably aware, accepting credit cards via email or over the phone is insecure. As people become more educated on the risks associated with insecure credit card transactions, you may alienate your customers by asking them to provide you with their credit card number in an insecure manner.
Uncomfortable conversations around due dates
Well this is awkward, your invoice due date came and went with no payment. This can be very disheartening to new freelancers. Inevitably you’ll have a client that is slow to pay. Are you sure your invoice was actually received by the client? Most modern software invoicing solutions alert you when your invoice has been opened. If you know it’s been received, you’ll want to have clear documentation on the dates you’ve reached out to them. You need to establish a cadence for follow ups that ensures you get paid as quickly as possible. It’s a delicate balance as many people are hesitant to disclose their financial situation (they simply may not have the cash flow to pay you immediately).
The financial component of freelancing is difficult and usually not fun. That’s the reason we developed giddyapp – we are creators, not accountants! We want software that handles the above points for us so we can get back to our passion.
giddyapp helps freelancers get paid on time. Click here to learn more.