Time spent on marketing, admin, sales, and training (Standard is 20-30%).
Required Daily Rate
$0.00
Approx. $0.00 per hour (based on 8h day)
Total Revenue Goal
$0
Total Available Work Days
0 days
Actual Billable Days
0 days
Billable Utilization
0%
How to Calculate Your Consultant Daily Rate
Determining the right daily rate is one of the most critical decisions for independent consultants and freelancers. Unlike a salaried employee, your rate must cover not only your take-home pay but also business expenses, taxes, unbillable administrative time, and time off.
The Consultant Daily Rate Calculator above uses a "bottom-up" approach. Instead of guessing a market rate, it calculates what you need to charge to maintain your desired standard of living and business viability.
The Formula Behind the Calculation
To arrive at a sustainable daily rate, we use the following logic:
Total Revenue Target: We sum your Desired Annual Income and your Annual Business Overheads. This is the gross amount your business needs to invoice.
Calculate Available Time: We take the weeks in a year (52) and subtract your desired weeks off for vacation, holidays, and sick leave.
Factor in Utilization: No consultant is billable 100% of the time. You must account for "non-billable" tasks such as:
Business development and sales calls
Invoicing and bookkeeping
Professional development and training
Marketing and networking
Final Division: The Total Revenue Target is divided by the actual number of Billable Days to give you the minimum daily rate required.
Why You Shouldn't Just Divide Your Salary by 260
A standard employee works roughly 260 days a year (52 weeks × 5 days). A common mistake for new consultants is to take their old annual salary, divide it by 260, and use that as their day rate. This is a recipe for financial failure.
As a consultant, you do not get paid for sick days, holidays, or time spent finding new clients. If you plan to bill 260 days a year, you are assuming 100% utilization with zero breaks, which is impossible. Most successful consultants aim for a utilization rate between 60% and 75% of their available working time.
Understanding "Overheads"
Your rate must cover the costs that an employer would typically pay. When inputting your Annual Business Overheads, ensure you include:
This calculator provides your floor rate—the minimum you need to charge to meet your financial goals. However, you should also research the market rate for your specific niche. If the market rate is significantly higher than your calculated rate, you have the opportunity to increase your profit margin. If the market rate is lower, you may need to reduce overheads or adjust your income expectations.
function calculateRate() {
// 1. Get input values
var targetIncome = parseFloat(document.getElementById('targetIncome').value);
var annualExpenses = parseFloat(document.getElementById('annualExpenses').value);
var daysPerWeek = parseFloat(document.getElementById('daysPerWeek').value);
var weeksOff = parseFloat(document.getElementById('weeksOff').value);
var nonBillablePercent = parseFloat(document.getElementById('nonBillablePercent').value);
// 2. Validation
if (isNaN(targetIncome) || targetIncome < 0) targetIncome = 0;
if (isNaN(annualExpenses) || annualExpenses < 0) annualExpenses = 0;
if (isNaN(daysPerWeek)) daysPerWeek = 5;
if (isNaN(weeksOff) || weeksOff < 0) weeksOff = 0;
if (isNaN(nonBillablePercent) || nonBillablePercent < 0) nonBillablePercent = 0;
// 3. Logic Calculation
// Total revenue needed to cover salary and expenses
var totalRevenue = targetIncome + annualExpenses;
// Calculate available working weeks
var workingWeeks = 52 – weeksOff;
// Calculate total potential working days
var potentialDays = workingWeeks * daysPerWeek;
// Calculate actual billable days after removing admin/non-billable time
// The nonBillablePercent is the portion of potential days lost to admin
var billableDays = potentialDays * (1 – (nonBillablePercent / 100));
// Prevent division by zero
if (billableDays <= 0) {
alert("Your inputs result in zero billable days. Please increase working days or reduce time off/non-billable time.");
return;
}
var dailyRate = totalRevenue / billableDays;
var hourlyRate = dailyRate / 8; // Assuming 8 hour standard day
// 4. Update UI
document.getElementById('dailyRateResult').innerText = '$' + dailyRate.toLocaleString(undefined, {minimumFractionDigits: 2, maximumFractionDigits: 2});
document.getElementById('hourlyRateResult').innerText = 'Approx. $' + hourlyRate.toLocaleString(undefined, {minimumFractionDigits: 2, maximumFractionDigits: 2}) + ' per hour';
document.getElementById('totalRevenueGoal').innerText = '$' + totalRevenue.toLocaleString();
document.getElementById('totalWorkDays').innerText = Math.round(potentialDays) + ' days';
document.getElementById('actualBillableDays').innerText = Math.round(billableDays) + ' days';
var utilization = 100 – nonBillablePercent;
document.getElementById('utilizationRate').innerText = utilization + '%';
// Show result box
document.getElementById('resultBox').style.display = 'block';
}