FreshBooks Retainers: What They Are and How to Create Them

The FreshBooks cloud-based accounting system makes it easier to collect recurring payments and bill customers for excess time through something known as retainers. A retainer in FreshBooks is very similar to the retainer concept found in the legal profession.

When you seek out an attorney to work on your case, that attorney may charge a retainer. A retainer is simply a fee to cover a certain amount of work. Should your attorney have to exceed the agreed work, you have the option of being billed for the additional work or submitting another retainer.

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FreshBooks retainers work on the same principle. You apply a retainer to a recurring customer’s account. You then do the work as promised. Should you exceed the retainer, the software will let you know. You can then choose to contact the client for instructions on what to do next or have the system automatically invoice your customer.

FreshBooks retainers also allow you to more easily collect recurring payments, track hours, forecast income, more effectively manage products, and more. Below is a step-by-step description of how to set up retainers.

Creating a Retainer

Create a retainer to be used in FreshBooks by going to the dashboard. On the left side of the dashboard is what is known as the Blue Menu. Navigate to the Retainers section. It is the second item under the Invoices section. Now:

  1. Click the green Create New button in the top right corner. You’ll be presented with a new page where you will be able to set the retainer’s parameters.
  2. Choose your client, the retainer amount, the billable hours it pertains to, the length of time it pertains to, and whether or not to send invoices automatically.
  3. Set the retainer to continue perpetually or be limited to a certain number of recurrences.

Once you’re done setting the parameters, click the green Set and Continue button at the bottom. You will then be directed to a new screen with a sample invoice for the client. You can use the invoice as-is or use the Settings menu on the right side of the page to modify it. Once you saved the invoice, you’re all done.

That’s all there is to creating retainers in FreshBooks. Creating retainers is an easy process that can save you a lot of time and trouble when you’re working with recurring payments.

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