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Hourly Billing Vs Monthly Billing

Hourly Billing Vs Monthly Billing
March 09, 2021

Which is better, hourly billing or monthly billing ?


When we talk about freelancers, one thing that we always tend to ask ourselves is, “How are we going to bill?”

Where are many ways to bill like hourly, daily, weekly and monthly on a per-project basis. There are several ways to charge your client. But the two most ways which an online freelancer must know are hourly and monthly. We will discuss all the pros and cons of both the feature. It will help you decide which to choose for further billing.


All about hourly billing:

Well, major creative freelancers like web developers and graphic designers bill by the hour. It may seem quite obvious, but many do question why. First of all, every work demands a different rate of labour skills. One work may need a lot of creativity or may need a bit of less work. Pricing for all amount of skills, if fixed same, will be unjustifiable. If you are billing per hour and the client decides to change the course midway through the project or wants to end suddenly, you are protected. You can still bill for all the number of hours that you have spent on the project so far.


So how does it work?

Whenever you switch on your device (Laptop or phone), your meter starts to run. Calculate all the number of hours that you have to spend each week on a specific project. Multiply that by your rate.

Send the bill at the end of the project with proper calculations.


Pros and Cons:

  1. Say no to daily meetings. Once you start billing by the hour, you do not have to answer daily.
  2. Also, you can work as per your time. The client will only ask for updates at a specified date and time.
  3. You get to charge whenever you are on the phone, in a meeting or working on your device. As long as it is related to the project, you can charge.
  4. You may choose to work a half-day or days off without getting into unwanted murky discussions and permissions. As long as you can finish the work on time, no one should ask you anything.
  5. But if you are more experienced and have a working speed faster than the junior ones, you are charging less. How? The number of hours decreases, and ultimately, you get charged less than the junior or a fresher.
  6. There will be a lot of invoice issues. Many clients do not understand or like the billing amount for Changes, Design Tweaks, Editing and revising, Code debugging. They have a notion that these all come under the main umbrella.
  7. With a massive project, sometimes it is difficult to estimate the exact hours. So, the charges become unrealistic.
  8. You have to be strict and vigilant with your time management because every minute is countable when you work on the project.


All About Monthly Billing

 When the project’s scope is big or estimated for months, clients do not like to take freelancers hourly. They like to retain the freelancers on a contract basis where the freelancer will dedicate their time solely for this project. They pay freelance workers monthly. Now, this is both beneficial for the client and the freelancers simultaneously. No parties have to scratch their head anymore to calculate and verify the number of days and hours. The price is fixed irrespective of the work and hours in the contract.


This kind of billing is no more about time but the project’s scope and a particular result.


Pros and Cons:

  1. You can bill and ask according to the value of the result, not time.
  2. The client already has a fair understanding of how much each service may cost as per the project. So, you do not always have to prove the worth of your work or pitch in profusely.
  3. Sometimes, the month’s work may be less, but you will be paid at the end of the month the same since it is contract-based.
  4. You have to attend meetings regularly about the project. Every step that you may need approval and budgeted for.
  5. Sometimes, there may be some changes in the scope that you need to negotiate a lot. Clients don’t usually budge in with negotiation for such turn over changes.
  6. You have to work for a certain period all day and report thoroughly.


Now, it’s on you how you see the project or the client is and charge accordingly. You do not have to stick to only one way. If the project is small, you can charge them hourly. If the project is big, you can charge them hourly. Before you decide on the rates and billing process, first have a meeting with the client to understand the scope of the work. It is a Discovery Meeting, or we can say a Road mapping Day.

Once you have all the points and clarity, you can easily decide.


But one thing freelancers need to keep in mind is that Value trumps money. Online freelancers often have reported not getting paid according to their value. You need to be strict with what you are offering and the pricing. One client may not budge, but those who understand the talent’s worth will pay you without questioning. Also, you should not charge way too much than the worth. Otherwise, it’s difficult for the client to keep up with your demands.


We hope that this small article helps you further to decide on the billing process. Register now to www.OnBenchMark.com and start your freelancing career without any difficulty!


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