When a project spans 2 or 3 months, waiting for a single final payment is a massive risk. If the client goes bankrupt or ghosts you at month 3, you've lost 90 days of income.
The solution is Milestone Payments.
1. The "Logic" of Milestones
Milestones align your effort with the client's risk. As you deliver value, they deliver payment. A standard milestone structure for a web project looks like this:
- Milestone 1: 25% Deposit (Project Kickoff)
- Milestone 2: 25% after Design Approval
- Milestone 3: 25% after Beta/Development Link
- Milestone 4: 25% before Launch/Final Handover
2. Setting "Gated" Milestones
Your contract should specify that "Work on the next phase will not commence until the previous milestone invoice is paid in full." This prevents you from being "too deep" into a project with an unresponsive payer. You can verify these "Stopping Work" clauses using our Contract Scanner.
3. Invoicing Milestones
Each milestone should have its own unique invoice number and clear description. For example: "Phase 2: UI/UX High-Fidelity Wireframes - Approved May 10th." This makes it easy for the client's accounting team to track the progress.
Frequently Asked Questions (FAQ)
What if a milestone is delayed by the client?
You should have a "Delayed Milestone" clause. If the client takes more than 14 days to provide feedback, you should be able to invoice for the work completed to date to protect your cash flow.
Can I charge different amounts for different milestones?
Yes. Some freelancers charge more for the initial "Discovery" phase (e.g., 40%) because it involves the most intense strategy and setup work.
Is a milestone payment the same as an hourly rate?
No. Milestones are usually "Fixed Price" based on deliverables. If you prefer billing for time, you should use weekly or bi-weekly invoicing instead.