Upwork offers two payment options for jobs, hourly and fixed-price payments.

Hourly payments occur when freelancers use the Upwork desktop app to track their time, and clients pay weekly. On the other hand, fixed price jobs are when the client pays for the entire project in a lump sum or at intervals called milestones.

In any case, both sorts of work are protected by Upwork’s money-back guarantee.

Many freelancers opt for hourly jobs because it is a more straightforward, dependable, and risk-free choice. Also, if you spend more time than anticipated or there are edits to the project, there will be fewer complications.

For example, if a client requests a change to the project requirements not included in the initial task, you simply track additional hours and receive payment.

When working on a fixed-price project, remuneration is based on the freelancer’s efficiency, not on the number of hours worked. I like this alternative since it enables me to complete more challenging tasks quickly and earn more money.

Understanding fixed price jobs

For fixed-price jobs, the client pays the freelancer in installments. The platform holds (freezes) the client’s funds for each Milestone and transfers them to the freelancer once the client acknowledges the freelancer’s work on each stage was successful. If work is not completed correctly, Upwork may refund the client’s money.

What are Milestones?

Milestones break down projects into deliverables by describing each step in the project. Each of these steps is assigned a price. All fixed prices projects have at least one milestone. The client establishes a budget and timeline for each step and job descriptions for a freelancer to complete during a milestone.

Since Upwork keeps the required amount of money in an escrow, it is an assurance that the client will compensate the freelancer for their job. I recommend that you discuss the deadline, budget, and any potential issues before the start of the project or the next milestone.

Pros of Fixed price jobs

Cons of Fixed price jobs

Understanding hourly jobs

Upwork encourages hourly payments to freelancers due to the high level of protection provided by this payment option. Upwork’s desktop application allows freelancers to keep track of their work hours. Each Monday, Upwork freezes money from a client’s bank account for the following week, the freelancer performs work and tracks time. The client reviews the freelancer’s work diary at the end of the week and earnings are released on Wednesday.

Clients can also restrict the number of hours you work for in a week. This allows them to set a weekly budget of how much they want to spend.

Pros of Hourly price jobs

Cons of Hourly price jobs

So, which should you pick?

If the project is short term and has a well-defined scope, go with on a fixed price broken down into milestones.

However, if the project scope is undefined, or the project is an ongoing one and you can’t truly establish the cost; opt to be paid at an hourly rate.