Retainer Fees for Freelance Executives

For seasoned executives who are not completely ready to give up their day jobs but want a little more independence, transitioning into a freelance role may be an option. As the Babyboomers reach retirement age, it's certainly a topic that's increasingly getting attention. This article from CFO.com offers a few suggestions for executives on how to become a freelance CFO. One tip, in particular, caught my attention.

The advice touches on everything from networking and building relationships to billable hours and office space. And listed among the top tips is to "Insist on a retainer..." and "Get your money up front." That's a good goal but I don't know if working only on retainer fees is always practical - or the best option, for you or the client. Especially as money tightens for projects of all types and sizes, it may be that more clients want to operate on a fixed-fee arrangement based on specific project terms as opposed to signing up for an on-going monthly fee.

Also, if your retainer fee is too high, you may find yourself at a competitive disadvantage in the market. On the flip side, you could also miscalculate what you need for an average fee. You need to make sure you cover your costs or you could end up on the losing side of that financial equation. Particularly when starting out as a freelancer, it pays to make sure you have a fair, competitive rate. Do you prefer to work on retainer? Leave a comment and tell us what you think.