In one line
Money paid in advance to hold your availability or to draw against for ongoing work.
Also called a retainer fee, a monthly agreement, or an advance on fees.
What it means in practice
A retainer is not a deposit. A deposit is part of the price of one job, credited at the end. A retainer is a balance the client tops up and you draw down as hours are used, or a fee that reserves your time whether or not it is used.
Say which of the two you mean in writing, along with what happens to an unused balance.
Covered in full in the guide to deposit invoices.
Example. A $2,000 monthly retainer covering up to 12 hours, with extra hours billed at the standard rate.
Where it shows up on the paperwork
On an agreement it names the amount, the period, what it covers and what happens to unused time. It is then billed as a recurring invoice rather than as a one-off deposit.
What goes wrong
- Calling a deposit a retainer, which makes the paperwork and the accounting confusing.
- Not saying whether unused hours roll over, which is the only question anyone asks in month three.
- Letting the scope grow inside the same fee until the retainer is losing money.
The tools for this
Related terms
- DepositPart of the price paid before the work starts, credited against the final balance.
- Advance paymentMoney paid before the work is done or the goods are delivered.
- Recurring invoiceAn invoice issued on a repeating schedule for work that continues month after month.
Common questions
What is the difference between a retainer and a deposit?
A deposit is part of the price of one job, credited at the end. A retainer holds your availability or is drawn down against hours, and is topped up as it is used.
Should retainers roll over?
Decide before you sign and write it down. Rolling over is generous and can build a large unpaid obligation; not rolling over is cleaner and needs saying up front.