Upwork has four types of payment, hourly fixed price, project catalog, and bonuses. Hourly contracts provide payments on a weekly billing cycle, which ends each week on Sunday. If you have an hourly contract, your funds will be available for withdrawal 10 days later. Fixed price contracts may consist of one or more milestones. Payment occurs when you complete a milestone and the client approves it. You can withdraw payment after a five day security period. Project catalog contracts also require the client's approval for the project. Once the client approves your project, your funds are available after a five day security period. Bonus payments are available to you after your client's payment is successfully processed and the five day security period has passed.
Upwork offers a range of flexible contract types, empowering you to choose the one that best suits your project structure. Here's a breakdown:
- Hourly contracts: Best for ongoing projects with evolving scope. You'll bill clients based on the hours you work, tracked through Upwork's time-tracking tool.
Hourly contracts allow you to pay a set rate for each hour worked, and you can set a weekly limit to control your spending. The freelancer can track their time using the Upwork time tracker to set up your project as an hourly contract. Click the posted job button to start the new job post. Answer the questions on each screen on the budget screen. Click the hourly rate box and enter the rate range you are willing to pay. Continue through the remaining sections. Once satisfied with the job post, click the button to post the job.
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Fixed-price contracts: Ideal for well-defined projects with a predetermined scope and fixed total price.
- Milestone contracts: A type of fixed-price contract, suitable for breaking down large projects into smaller milestones, with payments released upon completion of each stage.
A fixed price contract allows you to pay your freelancer for milestones rather than by the hour. We use an escrow system to help you and your freelancer feel financially safe. As you collaborate, we require you to deposit funds. When you send an offer to a freelancer, you may deposit funds for the whole contract or a lesser amount to cover the first milestone. How does escrow work? First, you'll add funds for the escrow amount and marketplace fee into your Upwork account. When you deposit funds into your Upwork account, you will see three transactions on your transaction history. Report, a credit for the initial amount, and two debits, one for the escrow amount, which will eventually go to your freelancer and another for the marketplace fee. Once your freelancer completes a milestone and you approve the work, you have 14 days to review it and approve or request edits.
Choosing the right contract
The best contract type depends on the project's nature and scope. Factors to consider include:
- Project scope: For well-defined projects, fixed-price contracts offer simplicity.
- Project duration: Hourly contracts are suitable for ongoing or evolving work.
- Payment structure: Milestone contracts are suitable for complex projects with staged deliverables.
At the start of a project, while contracts may be established, clients and freelancers can collaborate to adjust the contract type if the project's nature changes. This adaptability puts you in control of your work.
Expanding your earnings
Upwork offers features beyond traditional project listings to boost your income:
- Consultations: Offer one-on-one consultations (for those freelancers with one of the Upwork Talent Badges) or short-term services at an hourly rate. Clients can book directly on your profile. Learn more in our Consultations learning path.
Offer consultations and turn your skills into immediate income. Select your areas of expertise, set your rate, and choose when you're available to talk. Consultations are a great way to boost your earnings, build valuable client connections, and showcase your expertise.
- Project Catalog: Create pre-defined project packages with set scope and prices. Clients can purchase these packages directly from your profile.
Here's how the project catalog empowers you. Predefined packages create project packages that showcase your expertise, outline your deliverables, pricing, and timeline for specific services you offer. This allows clients to easily understand what you offer and how you can benefit their project client attraction. Clients actively browsing the project catalog are looking for freelancers with specific skill sets. By showcasing your predefined packages, you position yourself as a perfect solution to their needs. Clients can purchase your package directly, eliminating the need for lengthy proposal stages.
