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I'm pretty new to doing contract work and finally landed a decent paying project. The guy actually offered to put down a deposit and I'm just wondering what percentage I should consider asking for. I was thinking around 25% since its not a terribly large project (only about 20 hours).

Also, I can't use PayPal (have had a terrible experience with them freezing funds for no good reason) so I'm wondering if anyone can suggest other methods for the client to send the deposit / payment. I want to make it as easy as possible for them.. thanks for any advice

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2 Answers 2

When freelancing, I typically did 33%, 33%, 24% 10%, with the following milestones:

  • 33% due when the client accepted the proposal
  • 33% due when a working concept was delivered
  • 24% due when a production concept was delivered
  • 10% due 30 days after the delivery of a production concept

This gave me cash to start, cash when I finished the bulk of the work, cash after I polished the work to the point that it was ready for use and let the employer hold a bit back as an assurance that I'd stick around to fix bugs and issues.

It is very important that your agreement (hopefully a contract) stipulates exact milestones, and also covers the cost of work done outside of the scope of work. State an hourly rate for changes.

It might be worth the $200 it would cost you to go over this with an attorney in your area, to produce something legally binding. You might also look into escrow services that allow for milestone payments.

The above scale should ensure that you get compensated not only in milestones, but also according to the volume of work that you do, while establishing a bit of 'trust' on both sides.

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4  
+1 for getting it in writing! –  Tyanna Jan 7 '11 at 16:41
    
Most definitely concur - always get everything in writing, and make sure that both you and your client sign off on it. As much as it will provide "warm fuzzies" to the client that they will get what they are paying for, it stands to cover you and provide you with legal footing in the event that something goes wrong. –  Will Jan 7 '11 at 22:04

Elance.com has a decent invoicing/payment system for freelance developers.

It worked well for me on a couple of projects, but you don't get something for nothing. They do take a small % of the project for going through them.

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Most decent 'connect supply with talent demand' sites offer some sort of escrow service. The problem boils down to arbitration when things go south and a huge time zone gap exists between not only the parties, but the arbitrator. –  Tim Post Jan 7 '11 at 16:46
    
well if they guy's willing to give me a cash deposit I don't feel the need to cut elance in on the deal, they charge a fee or percentage so I meant more like a web payment method –  programmx10 Jan 7 '11 at 21:29

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