A guy I'm working on a startup with uses FreshBooks to do his invoicing. He has been extremely happy with FreshBooks after have been using Peachtree software for some time. It is really simplistic software that takes the headache out of invoicing. You can create a custom invoice, and let FreshBooks handle the rest. From what he was explaining, he just sends FreshBooks the name of the client, and how much they owe him, and they take care of everything else and deposit the money in his account. Granted this is only one opinion, but from being on both sides, he says he wouldn't do it any other way.
I use freshbook.com for invoicing and are very happy with it. It just works, give it a try with their free version, nothing to loose.
I use it for my freelancing as well. It's great, as I only have a few clients, the free version is fine for me. But it you have alot of clients, you have no choice but to go premium.