> ## Documentation Index
> Fetch the complete documentation index at: https://docs.timetracker.in/llms.txt
> Use this file to discover all available pages before exploring further.

# Run a monthly retainer

> Set up a recurring monthly budget that resets each month, track hours against it, and handle the month your team goes over the retainer.

A retainer is a budget that resets every month.

Set the budget once, choose **monthly** periodicity, and each new calendar month starts fresh. You do not create a new project or a new budget every month.

<Info>
  **The example:** Bluebird Coffee – Monthly Retainer. **40 hours per month**. Priya Raman (Project Manager) runs it. Daniel Okafor (Finance) bills it.
</Info>

## Before you start

<Warning>
  **Plan requirement.** Budgets and invoicing are **Pro**. See [Free vs Pro](/billing/free-vs-pro).
</Warning>

You need the **Budgets & profitability** app on, which needs **Projects & tasks** and **Time tracking**. See [Apps and modules](/concepts/apps-and-modules).

## Set the retainer up once

<Steps>
  <Step title="Priya creates a separate project for the retainer">
    Keep the retainer as its own project, even for a client who also has fixed price work.

    Bluebird Coffee has two projects: **Website Redesign** (fixed \$40,000) and **Monthly Retainer** (40 hours a month). Mixing them into one project means you can never tell which one is profitable.

    → [Create a project](/projects/create-a-project) · [Client projects](/clients/client-projects)
  </Step>

  <Step title="Priya sets a monthly budget">
    Set the budget to **40 hours** and the periodicity to **monthly**.

    A one-time budget is a single ceiling for the life of the project. A monthly budget is a fresh ceiling each calendar month. The month boundary follows your workspace timezone.

    → [Recurring retainers](/budgets/recurring-retainers) · [Set a project budget](/budgets/set-a-project-budget)

    <Tip>
      Choose **hours**, not money, for most retainers. A retainer is a promise of capacity, and an hours budget counts every hour the same whoever works it. Use money if the deal is "\$4,000 of work a month" rather than "40 hours a month". See [Hours vs money budgets](/budgets/hours-vs-money-budgets).
    </Tip>
  </Step>

  <Step title="Priya adds the people and sets rates">
    Add Sarah, Jonas and Ana as project members. Their rates are already set at the person level, so the retainer picks them up.

    | Person        | Billable rate | Cost rate |
    | ------------- | ------------- | --------- |
    | Sarah Lin     | \$100         | \$45      |
    | Jonas Bergman | \$120         | \$60      |
    | Ana Ferreira  | \$80          | \$55      |

    → [Project members](/projects/project-members) · [Set a person rate](/rates/set-a-person-rate)
  </Step>

  <Step title="Priya sets up recurring tasks and alerts">
    Retainer work repeats. Create the standing tasks once and let them recur, instead of retyping them every month.

    Turn on budget alerts so 40 hours does not arrive as a surprise. They fire at 50%, 75%, 90% and 100% – so at **20**, **30**, **36** and **40** hours.

    → [Recurring tasks](/tasks/recurring-tasks) · [Budget alerts](/budgets/budget-alerts)
  </Step>
</Steps>

## A normal month

March at Bluebird.

| Person        | Hours  | Rate  | Billable value | Cost rate | Cost        |
| ------------- | ------ | ----- | -------------- | --------- | ----------- |
| Sarah Lin     | 26     | \$100 | \$2,600        | \$45      | \$1,170     |
| Jonas Bergman | 10     | \$120 | \$1,200        | \$60      | \$600       |
| **Total**     | **36** |       | **\$3,800**    |           | **\$1,770** |

* Retainer used: **36 of 40 hours**, which is **90%**.
* Four hours unused.
* Margin: **$3,800 − $1,770 = \$2,030**, or **53.4%**.

The 90% alert fired near the end of the month. Nothing needed doing.

<Note>
  Unused hours do not carry into April. The budget resets on 1 April. If your agreement with the client says hours roll over, you have to track that yourself – the reset is a clean line.
</Note>

## The month you go over

April at Bluebird. A campaign launch pushes the work up.

| Person        | Hours  | Rate  | Billable value | Cost rate | Cost        |
| ------------- | ------ | ----- | -------------- | --------- | ----------- |
| Sarah Lin     | 24     | \$100 | \$2,400        | \$45      | \$1,080     |
| Jonas Bergman | 16     | \$120 | \$1,920        | \$60      | \$960       |
| Ana Ferreira  | 8      | \$80  | \$640          | \$55      | \$440       |
| **Total**     | **48** |       | **\$4,960**    |           | **\$2,480** |

* Retainer used: **48 of 40 hours**, which is **120%**.
* **Eight hours over.** In April those last eight hours were Jonas's, at $120 an hour, so the overage is worth **$960\*\*.
* Margin on the whole month: **$4,960 − $2,480 = \$2,480**, or exactly **50%**.

### What Priya does about it

<Steps>
  <Step title="She saw it coming at 36 hours">
    The 90% alert fired with a week of April left. That is when the conversation happens, not on 1 May.

    → [Budget alerts](/budgets/budget-alerts)
  </Step>

  <Step title="She tells Ruth before the work happens">
    Priya messages Ruth at Bluebird: the retainer is at 36 of 40 hours, the campaign needs roughly another 8, and Northwind can either stop at 40 or bill the extra at standard rates.

    Getting agreement before the hours are worked is the difference between an invoice and an argument.
  </Step>

  <Step title="Ruth approves the extra">
    Bluebird agrees to the 8 extra hours.
  </Step>

  <Step title="Daniel bills the retainer and the overage separately">
    Two lines, or two invoices:

    | Line                              | Amount                  |
    | --------------------------------- | ----------------------- |
    | Monthly retainer, April           | The agreed retainer fee |
    | Additional hours, April – 8 hours | \$960                   |

    Keeping the overage on its own line is what makes it obvious to the client, and easy for you to see how often it happens.

    → [Create an invoice](/invoicing/create-an-invoice) · [Invoice from tracked time](/invoicing/invoice-from-tracked-time)
  </Step>

  <Step title="If it happens three months running, change the retainer">
    One busy month is normal. Three in a row means the retainer is the wrong size. Raise it to 48 or 50 hours and reprice.

    → [Set a project budget](/budgets/set-a-project-budget)
  </Step>
</Steps>

## Read the retainer every month

| Question                   | Where to look                                                 |
| -------------------------- | ------------------------------------------------------------- |
| How many hours did we use? | The project's budget bar                                      |
| Did we go over?            | Budget burn past 100%                                         |
| Was the month profitable?  | [Profitability and margin](/budgets/profitability-and-margin) |
| Which work ate the hours?  | [Build a report](/reports/build-a-report) grouped by task     |
| Is the trend up?           | The same report across three months                           |

<Tip>
  Save one retainer report and schedule it for the first working day of each month. Then the review happens whether or not anyone remembers. See [Schedule a report](/reports/schedule-a-report).
</Tip>

## Retainer patterns that work

| Pattern                                        | Set it up as                                           |
| ---------------------------------------------- | ------------------------------------------------------ |
| "40 hours a month of support"                  | Hours budget, monthly, 40                              |
| "\$4,000 of work a month"                      | Money budget, monthly, \$4,000                         |
| "40 hours a month, unused hours are lost"      | Hours budget, monthly. This is the default behaviour.  |
| "A block of 200 hours, use them when you like" | Hours budget, **one time**, 200. Not a monthly budget. |
| Retainer plus separate project work            | Two projects under the same client                     |

## Common questions

<AccordionGroup>
  <Accordion title="Do unused hours carry over to next month?">
    No. A monthly budget resets at the start of each calendar month, in your workspace timezone. If your agreement allows rollover, either track it outside the product, or use a one-time budget for the whole committed block instead. See [Recurring retainers](/budgets/recurring-retainers).
  </Accordion>

  <Accordion title="Does going over the retainer stop anyone tracking time?">
    No. A budget is a measuring stick, not a hard stop. Work continues and the burn keeps counting past 100%. The alerts are how you find out.
  </Accordion>

  <Accordion title="Can I have a retainer and a fixed price project for the same client?">
    Yes, and you should. One client can have many projects. Keeping them separate is the only way to tell which one is profitable. See [Client projects](/clients/client-projects).
  </Accordion>

  <Accordion title="Can Ruth see how many retainer hours are left?">
    Only if you share it. A client portal contact sees what is explicitly shared with their company, and budget and cost are internal by default. See [What clients can see](/portal/what-clients-can-see).
  </Accordion>

  <Accordion title="How do I change the retainer size mid-year?">
    Edit the budget on the project. The new amount applies going forward. Past months keep the figures they were measured against.
  </Accordion>

  <Accordion title="Do non-billable hours count against the retainer?">
    On an hours budget, yes – every hour counts. That is worth agreeing with the client up front, because internal admin time can quietly eat a retainer. See [Billable vs non-billable](/concepts/billable-vs-non-billable).
  </Accordion>
</AccordionGroup>

## Related guides

<CardGroup cols={2}>
  <Card title="Monitor project profitability" icon="chart-line" href="/guides/monitor-project-profitability">
    The weekly check that catches the overage early.
  </Card>

  <Card title="Month-end close" icon="calendar-days" href="/guides/month-end-close">
    Billing the retainer with everything else.
  </Card>

  <Card title="Quote to invoice" icon="file-invoice-dollar" href="/guides/quote-to-invoice">
    Pricing the project work alongside a retainer.
  </Card>

  <Card title="Track work for a client" icon="route" href="/guides/track-work-for-a-client">
    The full chain for one client.
  </Card>

  <Card title="Setup for an agency" icon="building" href="/guides/setup-for-an-agency">
    Running several retainers at once.
  </Card>
</CardGroup>