You landed your first freelancing gig, and you’ve been excited about it ever since. You’ve done the work, the client is happy, and you’re ready to get paid.
Then you remember that you’ve never created an invoice before and you have no idea what you’re doing. Don’t worry. Every freelancer and business on the planet has created a “first” invoice, and once you’re done with yours, the entire invoicing process will seem simpler.
Let’s walk through the steps you’ll need to take in preparing your first freelancing invoice.
Step 1: Find a template or start from scratch
First, you’ll need to decide if you’re going to use a template or start from scratch. If you’re looking for a template, Square has a massive archive for you to choose from—you can select the format that appears most relevant for your business, and tweak it as you see fit. If you’re starting from scratch, you can use a program like Word or Excel to create the basis for your invoice without much issue.
Step 2: Prepare the invoice header
Once you have the start of your document, you’ll need to flesh out the header—one of the most important parts of the invoice. The header is meant to contain the most important “baseline” information for the transaction, including:
- Your name or business name: Include your name or your business’s name in the header. Even if you’re sending the invoice personally, it helps the recipient to organize this paperwork later.
- Recipient name: Include the name of your recipient for your records.
- Your business address: Include your physical address so they know where to mail the check.
- Contact information: Include a phone number and email address so your recipient has multiple convenient ways to contact you.
- Date and payment deadline: Include the date that the invoice is being sent, the date for the products and services provided, and the deadline for receiving payment (usually within 30 days of the initial invoice).
- Invoice number: You’ll also want to create an invoice number, based on a numbering scheme of your choosing. For example, you might start certain invoices with a certain string of numbers like “999,” so you can number your invoices 99901, 99902, 99903, and so on.
- Payment methods: In the header or the footer, make sure you note what payment methods you accept, and how to provide them. You can add your bank account information for bank transfers. You should also share the details of other payment options.
Step 3: Create categories for line items
Next, you’ll want to create broad categories for the line items you plan to list in the future. For example, you might include things like “consulting hours,” “design hours,” or things like “products” and “shipping.” These will depend on the nature of your business, though you can be as vague or specific as you want to be.
Step 4: Apply formulas as necessary
If you’re using Excel to build out your invoice, make sure you use common formulas to automate your calculations and ensure the accuracy of your document. This is important for calculating the total value of accumulated per-item costs, as well as calculating the total value of your invoice. Be sure to document each individual component of your calculation so it’s publicly visible. When you’re done, include the invoice total at the bottom of the document, bolded so it stands out at even a glimpse.
Step 5: Double check your work
At this point, it’s a good idea to check your work. Make sure all your numbers are accurate and adding up correctly, and ensure you’ve spelled everything correctly as well. An error on the invoice could damage your reputation, even if it’s an unintentional one.
Step Six: Finalize the invoice format
Finally, you’ll want to reformat the invoice to prepare it for sending. If you’re building it in an Excel or Word document, you’ll want to convert it to a PDF format. Other formats are possible, but your main goal should be to eliminate the possibility of further editing. It helps to add a finishing touch to make the document look more professional, like a branded watermark, but this isn’t strictly necessary.
Now that you’ve created your first invoice, you can send it off and collect your first payment. More importantly, you now have a standard, personalized template that you can use for your next gig. Over time, you may need to gradually update your formatting to accommodate new features or customer preferences, but this is to be expected. No invoicing system is perfect the first time around.