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I work as a freelancer and want to start tracking my time, but how do I decide how detailed this should be?

Currently, I just keep track of the time I spend on various projects, but I don't subdivide my time between different parts of those projects.

So now I'm looking for some guidelines to decide for my projects how detailed it should be.

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Track your time now in as much detail now so that you can reconstruct what you worked on six months from now.

This might be a bit vague but bear with me. There are a couple of reasons for this 6-month rule:

  • Matching Your WBS: Each task normally has an expected number of hours/days/weeks attached to it. You should track at that level know if you are are ahead or behind a current task.
  • Improving Your Estimates: at the start of the project you would have picked something like Task X = 20 hours. If you didn't track how long Task X actually took, you can't tell if you are under or over on the estimate.
  • Billing Questions: As a freelancer, you will eventually get questions from your clients' accounting departments asking about past work. If you haven't tracked time to a level that makes sense to the business/finance/accounting person on the other end, you can waste a lot of time reconstructing past events.

At my previous IT consulting company, we the output of our time tracking software was attached directly to the client invoice. If I entered "Assisted Verizon with installation of T1 line and CSU, then configured router and firewall for new circuit" that comment showed up as line item on the invoice. That saved a lot of time in the long run. Of course, you had to write clear information into your time sheet - that took a while to get used to...

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    +1 for billing questions. Very important! If you don't track time for any other purpose, do track it for this one! – jmort253 Feb 19 '11 at 6:59
  • For a PM in a big company - much less important. But this was specifically about a freelancer... – SBWorks Feb 21 '11 at 0:47
  • To back up SMWorks, it's CRITICAL that you are able to back up what you are billing to your client. It goes a long way toward trust, etc. I have been tracking to the 1/4 hour (15 minutes) for 3 years now, and my clients are so used to it, I doubt they even look at the details anymore. They know the answers are there as to what I did and billed for, and so they can look whenever they need to. Generalizing, when you have your PM hat on, the time should not be tracked so granularly, but when you are billing, esp. as a freelancer . . . very detailed is the way to go. – richard Feb 22 '11 at 20:19
  • Addendum . . . what I said is for "time and materials" projects, not lump sum. If you have an agreed upon price for the project, then by all means, just track to whatever time interval will help you bid better next time. Otherwise, what you are selling to the client is "time", so you better track it closely. – richard Feb 22 '11 at 20:21
  • On further though, there might actually be a difference in the question, I mean the answers for "as a freelancer or external consultant" would be different then for "as part of an enterprise PMO" – SBWorks Feb 23 '11 at 0:52
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+1 to SBWorks

I'd add that there's a fine balance between too much granularity (which becomes a pain to keep track of) and not enough.

As a general rule of thumb, on a shorter project, each bucket of time should be of things on which at least 8 hours is spent.

On medium length projects (1 -3 months), each bucket should be of at least 20 hours.

On longer projects (3+ months), each bucket should be of at least 40 hours.

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