How to Invoice for Progress Payments | Reddit & LinkedIn

Progress payments bill the client in stages as the job moves forward, rather than one lump sum at completion. On anything longer than a few days, lump-sum billing forces you to float materials and labor for weeks, and that is how a profitable job turns into a cash-flow problem.

Billing progressively ties each payment to work the client can see is done. It reduces your exposure if a job stalls, keeps the relationship clear, and pulls the average payment cycle down from the 60 days a lump-sum invoice often waits.

Work line by line off the schedule of values. For each line, the amount earned this period is the line value times the percent complete, minus everything you already billed on that line. Sum the earned amounts across all lines to get the gross draw.

Then subtract retainage, the percentage the owner holds back until completion. The result is the current payment due. Showing the math line by line is what makes the invoice easy to approve, because the reviewer is checking against a schedule everyone already signed.

A clean progress invoice shows the invoice number and billing period, each schedule-of-values line with its value and percent complete, the amount earned this period, retainage withheld, the total previously billed, and the current balance due. It should also carry a clear payment link.

Where the contract or state law requires it, attach a lien waiver matching the payment. Progress-billing waivers are conditional on the payment clearing, and getting the waiver type right protects both you and the owner.

Retainage is a portion of each payment, commonly 5 to 10 percent, that the owner withholds until the job is substantially or fully complete. It gives the owner a strong incentive for you to finish the work, and it is standard on larger and commercial projects.

Track retainage on every draw so you know exactly how much is being held. At closeout, you bill the accumulated retainage as its own line. Contractors who do not track it carefully are often surprised by how much is sitting unpaid at the end of a job.

ContractShield turns the accepted quote into milestones, so progress billing is built into the job rather than rebuilt each period in a spreadsheet. You invoice a milestone as it completes, the client pays with one tap, and the money moves.

Overdue invoices chase themselves with automated polite-to-firm reminders, which is what pulls a 60-day cycle toward 14 days. The platform fee stays 2% per job (1% each side), capped at $250, with no per-lead fees, billed only when the client pays, so steady billing does not cost you a subscription.