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Billing Your Services When You Are a Freelancer: The Bank of Hours

When you become a freelancer or self-employed worker, you need to answer questions about billing your services. Are you going to bill per hour, project, word, or package? What is the best option for you? Let us present to you another option: the bank of hours. In this article, we will see what a bank of hours is and its advantages. <h3>What is a bank of hours?</h3> Before we start, we need to say that we were surprised to find only a few articles on the bank of hours and its advantages. Still today, too many freelancers and self-employed workers choose to be paid on an hourly basis, although there are many other options to their situation. Therefore, what is a bank of hours? To sum it up quickly, a bank of hours is a number of work hours purchased in advance by a client. Often, the more hours bought in a bank of hours, the better it is for the client because they can have access to a preferential rate. Banks of hours are often used for long-term business relationships or for a project we do not know the number of hours to complete.  Here is an example: Amelie is a community manager. She needs to create social media posts, make visuals, write texts, and do some monitoring for a client. Since some posts take more time than others, Amelie could choose to offer a bank of hours or a package that would cover all her client’s needs for a period of time instead of billing every action or worked hour. She can start the process by estimating the number of hours. Then, she will only have to deduct the worked time progressively. <h3>What are the advantages of a bank of hours?</h3> Whether it is for the professional or the client, there are many advantages to offering a bank of hours. Of course, it needs to work with your line of business. Let us examine this more closely. It allows you to create long-term business relationships First, the primary purpose of offering banks of hours when you are a freelancer is because it helps create a long-term business relationship with your clients more efficiently. Indeed, banks of hours are there for a time period, not for a simple task. It shows that your client wants to work with you; consequently, you need to plan some time in your schedule for them. It can also help you be less stressed since you might not have to <a href="https://www.momenteo.com/blog/5-ways-to-find-new-contracts" target="_blank">look for new contracts</a> for some time. It is an interesting income Another relevant point is the fact that banks of hours are bought and paid before you start working, <a href="https://www.momenteo.com/blog/freelancers-should-you-ask-for-a-down-payment" target="_blank">like a down payment</a>. You will not have to wait until the end of the worked hours to get your money, which can be less stressful. It also means that your client is a good payer that will not disappear when you send the final invoice or the job is done.  It is often cost-effective On the client side, purchasing a bank of hours can be cost-effective if they have the needs. Indeed, one of the main advantages of banks of hours is that it is often less expensive to buy more work hours in advance than to buy them individually. Freelancers and self-employed workers often offer a discount. Therefore, if you are a client and are interested in purchasing a bank of hours, start by taking the time to estimate your needs. Do you need 10 or 30 work hours per month? Of course, you can always buy some more time if your bank of hours is empty. It offers flexibility Banks of hours also give some flexibility to your client. If your client needs you, they will only need to contact you to use some of the time of the bank of hours. Of course, it is possible that you have a lot of requests at the same time, and it might get too quiet a few weeks later. Here is a tip: when you offer a bank of hours to a potential client, ask some questions about their needs and expectations (how many hours of work per week or month?). This way, it will be easier to prepare your schedule accordingly. It allows you to manage your time better Finally, a bank of hours can allow you to manage better and save time. As mentioned above, you might not have to look for other contracts since you already have some booked and paid hours. You will also have a better idea of the tasks you need to do. In addition, you will only have to send a single invoice, which can help you save some time regarding your administrative tasks. Of course, you need to note down all the tasks and worked hours if your client wants to have a report on the utilization of its bank of hours.  <h3>Do not forget the contract of services</h3> What must you do if your client wants to end the business relationship with you when there are still hours in the bank? Do you accept refunds? When must your client pay the bank of hours, and what are your responsibilities regarding them? Avoid misunderstandings and problematic situations by adding the terms of use of your banks of hours to <a href="https://www.momenteo.com/blog/the-importance-of-having-a-good-contract-of-services" target="_blank">your contract of services</a>. In conclusion, as we have seen, it could be relevant to offer a bank of hours to your clients. Besides ensuring that you will be paid for your services, it will allow you to save time and create long-term business relationships. If you need some help managing your bank of hours, do not hesitate to use <a href="https://www.momenteo.com/features/time-tracking/" target="_blank">Momenteo’s time tracker</a>. You only need to launch it when you start working and deduct the time progressively from the bank of hours. Good luck!

Ariane