As a freelancer, time is your inventory.

If you’re not tracking your time, you’re missing out on valuable data about your productivity, your workload, and your profitability.

When I started freelancing, I often gave clients more of my time than they’d paid for. The problem wasn’t necessarily that I’d logged unbillable time, but that it was unintentional — and by that, I mean, I didn’t keep track of the hours I’d put toward the project and spent more time than I was willing to give.

So I began using a spreadsheet to track my time for client projects. For one of my clients, the summary of hours revealed that I was spending on average twice as many hours per week than I was paid for. It was a wake-up call.

It didn’t seem like a big deal to give this client an extra 10 minutes here and there until then. But it adds up, and I was losing both time and money (neither of which I could afford to lose).

Even if you don’t bill your clients hourly, tracking your time will refine your estimates for determining project rates. Sometimes, we leave money on the table because we think we know how long it takes to complete a task when it actually takes much longer. I’ve made the mistake of “guesstimating” my time (“sure, I can draft an article in an hour”) only to realize I’ve underestimated the required input — research, client edits, etc.

Tracking your time is like tracking what you eat or spend. You need to know where your time is going each day, each week, each month, so that you can adjust accordingly. For example, you need to know which of your clients maximize your profits and which are a drain on your time.

I use Google Sheets to track my time, and I’ve added my timesheet as a tab in my browser navigation for easy access each morning. I keep it open all day, every day. I’ll walk you through this sheet to show you how I track my time and analyze the data.

How to Track Your Time in a Spreadsheet

When I started, I often totaled my time for clients on a sticky note (by hand!). This was easy when I tracked time for only 1–2 clients, but it quickly became inefficient. Especially considering a spreadsheet will calculate this data automatically.

I keep my spreadsheet fairly simple. If it weren’t simple, there’s a big chance I’d abandon it. There are only a few critical details I need to record in my timesheet: (1) the date, (2) the client, (3) the task, and (4) time logged. I create a new tab each month.

The spreadsheet does the heavy lifting. I record the time I start and stop working (say, 9:30 AM and 10:15 AM), and a third column totals the time elapsed.

Calculated Time: This column automatically calculates time elapsed (the difference between my “start” and “end” times in hours:minutes). If I begin a task at 9 AM and stop working at 10 AM, the “calculated time” is 1 hour.

Calculated Decimal: This handy column automatically calculates time elapsed as a decimal, because this is typically how you record billable hours in software like Quickbooks, or on an invoice. For example, 30 minutes, or half an hour, is .5 hours.

Recorded Time: Refers to the decimal you’ve “recorded” for client billing. This column accounts for any rounded time. I round to the nearest tenth of an hour when I’m recording billable hours on a client invoice. For example, if I’ve logged 25 minutes, I won’t bill my client .42 hours. I round to .5.

There’s a row at the very top of the sheet which gives me totals for both the “calculated decimal” and “recorded time” columns. Not only can I see these totals at a glance, but I’m able to compare the totals for discrepancies.

They won’t be exact due to rounding, but if there’s a big difference, it means you’ve mistyped in your Recorded Time column (for example, “6” instead of “.6”). You want to catch this before you record the wrong amount on an invoice!

Summarizing Time by Client or by Project

Arguably the most important piece is the “summary” tab, which breaks out totaled time by client. This is a pivot table that automatically pulls data from my primary timesheet. The table pulls the labels from the “client” column of my primary sheet. The best part is, I don’t even touch this pivot table, if I log time for a new client, the table automatically populates the new label.

This is how I keep an eye on recorded time per client throughout the month, review my hours, and invoice clients at the end of each month. If you’d like to track your time using this method, you can download my template with these built-in formulas.

These are the questions to ask yourself when you examine the summary of your recorded time:

• Where does my time go each day? Am I getting more done in less time?
• Are my hours in line with my estimates? (Am I on track for [client]?)
• Have I underestimated the time it takes to complete a particular task or project?
• Are there tasks I could eliminate to free up time?

It’s up to you how often you check your “summary” tab. It’s critical if you have a “will not exceed” agreement with a client.

I have several clients on “retainer” who pay me for a specific number of hours each month. I won’t make more money if I exceed the agreed-upon hours (unless the client has approved the additional time), which means I need to know where I stand throughout the month, so I don’t go over.

You can use this data as a client communication tool, as well. Even without a “will not exceed” agreement, it’s professional and polite to give clients a heads-up when you’ve reached a certain threshold of hours. At this point, it’s their choice to green-light additional hours, and the client isn’t blindsided by a huge bill at the end of the month.

And if you charge a project rate based on estimated hours, this is a tool to keep yourself on track. If (when!) you find that a particular task takes more time than you’d anticipated, adjust your project rate to maximize profitability. Your time is worth it!

Why Keep a Spreadsheet When You Have Software Like Quickbooks

Software like Quickbooks or Freshbooks will automatically pull your recorded time to generate an invoice. Even so, I believe it’s beneficial to track your time in a personal spreadsheet, even if you enter it into another time tracking system simultaneously.

One reason is that it’s often simpler to keep your spreadsheet open throughout the day to track your time as you go. It’s easily accessible. Then, you can transfer each time item into Quickbooks at the end of the day.

While that might seem inefficient, this leads me to my second reason: Your spreadsheet is a precious “backup.” If the software crashed or lost your recorded time, you could potentially lose money. There would be no way for you to know how many billable hours went unrecorded.

Not to mention, the spreadsheet allows you to “check” yourself. When you generate an invoice at the end of the month, your totaled time in Quickbooks should match the total for your “Recorded Time” column in your personal spreadsheet.

You Can Track More Than Your Billable Time

The most obvious tasks to track are billable client work. This is the work I bill on a client’s invoice. At first, this is all I tracked on my timesheet; in the last month, I’ve started tracking time spent on personal creative projects and also “admin” tasks like emails, invoicing, etc.

I track my time spent writing Medium articles, building my website, creating landing pages in ConvertKit, and drafting emails for my list. As I continue to grow my brand and business, I need to know how much time I dedicate to each of these “buckets.” It also gives me a sense of how I’m balancing my time between client work and everything else.

I track administrative tasks because I’m curious to see how much of this time eats into my billable hours. In the past, I’ve felt guilty for only logging 3–4 “billable” hours in a day. And then my dad — an entrepreneur and small business owner — reminded me that none of us truly has 8 hours a day. When you work for yourself, you wear every hat, and you have to make time for admin tasks like client outreach, invoicing, etc.

An Argument for Tracking Non-Billable Time

This is helpful if you need to segment time for a particular client — for example, I add the initials “NB” after a client’s name if I’d like to break out “non-billable” time. And this is a key point; I don’t track my time with the intention of nickel-and-diming my clients. It is not a problem to give away your time. But if you do, you should know how much and how often.

Adding this simple tag (NB for “non-billable”) allows me to keep up with the time rather than ignoring it. Sure, you could opt not to enter this time at all. But in that case, you’d never truly know how much time you’ve spent on the client (time that isn’t billed).

Time is Your Inventory

Time tracking will reveal things about your work and your schedule you would never have guessed.

You may recognize patterns in productivity throughout the week. You may find similar tasks you can batch to free up time for more billable work. You can also keep an eye on your efficiency and get a feel for how quickly you’re improving; for example, are you tackling frequent projects in less time?

It’s not always about money; it’s about time. We only have so much of it. Your goal as a freelancer is to maximize your time and work with clients who value your time.

The data will help you make strategic choices about how to grow your business: which clients and projects to pursue, what you should charge to compensate yourself appropriately, and when to raise your rates.