It may very well be that a burgeoning developer needs to cut corners financially and hosting is a good place to start. That being said, I do not recommend bundling the purchase of domains with the purchase of web hosts.  My reasoning here is that should you need to move your content later on, your provider may prove to be problematic in your ability to service your domain, whereas a standalone registrar, such as Hover.com, expects that you will point your domains as needed.

The vast majority of web hosts that offer unlimited everything are doing so on what is known as shared server hosting.  What that means, is that your content and that of your clients should you “host” their domains on your account will be stored and served along with other clients of your web hosting provider.  Now you may think, “That doesn’t sound so bad, since I’m getting such a great deal,” however this CAN bite you.  A great example of this is when I noticed that my personal website and that of my very first paying customer (yes it was my cousin) were both down.  The reason?  Another account that was on the same server was marked as a purveyor of spam.  Thus “our” IP address was blocked with several services, which affected the sites themselves, as well as the affiliated email addresses.  It took me the better part of three days to get that entire debacle fixed.

Let this serve as a cautionary tale for you.

Another issue of budget hosting is the term applied to the premium pricing.  It is not as loudly disclosed, but most of those discounts only apply to the first contracted term.  Once that one - three years is over the customer is expected to pay the regular rate for the product, which is more likely $6-10/month on a sliding scale.  At the point in which regular price kicks in, it is definitely time to compare prices for dedicated, or virtual hosting.  While these options are naturally more expensive, there are providers that are offering lower cost options in that arena.  Factors to consider when deciding include your average traffic and bandwidth usage, as well as your storage needs as these hosting options are less likely to offer unlimited resources in low cost plans.

There is nothing wrong with using a budget host to get your foot in the door as a freelance developer and with proper prior planning, doing so can prove to be a major help when funds are limited.