Interest Rate Calculator in Excel

Freelance Hourly Rate Calculator

Your Recommended Hourly Rate

function calculateFreelanceRate() { var income = parseFloat(document.getElementById('desiredIncome').value); var expenses = parseFloat(document.getElementById('annualExpenses').value); var hoursPerWeek = parseFloat(document.getElementById('billableHours').value); var weeksOff = parseFloat(document.getElementById('weeksOff').value); var taxRate = parseFloat(document.getElementById('taxPercentage').value) / 100; if (isNaN(income) || isNaN(expenses) || isNaN(hoursPerWeek) || isNaN(weeksOff)) { alert("Please fill in all fields with valid numbers."); return; } // Total gross income needed before taxes var grossRequired = (income + expenses) / (1 – taxRate); // Total billable weeks in a year var billableWeeks = 52 – weeksOff; // Total billable hours in a year var totalAnnualHours = billableWeeks * hoursPerWeek; if (totalAnnualHours <= 0) { alert("Total billable hours must be greater than zero."); return; } // Minimum Hourly Rate var hourlyRate = grossRequired / totalAnnualHours; // Display Results document.getElementById('resultArea').style.display = 'block'; document.getElementById('hourlyResult').innerHTML = '$' + hourlyRate.toFixed(2); var breakdown = "To net $" + income.toLocaleString() + " after expenses and " + (taxRate * 100) + "% taxes, you need a gross annual revenue of $" + Math.round(grossRequired).toLocaleString() + ". " + "Based on working " + hoursPerWeek + " billable hours for " + billableWeeks + " weeks per year, you must charge at least $" + hourlyRate.toFixed(2) + " per hour."; document.getElementById('breakdownText').innerHTML = breakdown; document.getElementById('resultArea').scrollIntoView({ behavior: 'smooth' }); }

How to Calculate Your Freelance Hourly Rate

Setting your freelance hourly rate is one of the most critical business decisions you will make. Unlike a traditional salary, your hourly rate must cover more than just your time; it must account for overhead, taxes, software, health insurance, and non-billable hours like marketing and administration.

The "Billable Hours" Trap

New freelancers often make the mistake of assuming a 40-hour work week. In reality, most freelancers spend 25–35% of their time on administrative tasks, pitching clients, and invoicing. If you want to work 40 hours total, your billable hours might only be 25 or 30. Our calculator accounts for this by asking for your actual billable hours per week.

Factoring in Expenses and Taxes

As a business owner, you are responsible for costs that employers usually cover:

• Self-Employment Tax: You must cover both the employer and employee portions of social security and medicare.
• Software & Hardware: Subscriptions like Adobe Creative Cloud, Zoom, and your laptop replacement fund.
• Benefits: Health insurance, disability insurance, and retirement contributions (401k or SEP IRA).
• Time Off: You don't get paid for holidays or sick days. You must build that "lost revenue" into your active working hours.

Example Calculation

If you want to take home $70,000 a year, have $8,000 in annual expenses, and want 4 weeks of vacation, your math looks like this:

1. Total Needed (Pre-Tax): At a 25% tax rate, you need ~$104,000 gross.
2. Billable Hours: 25 billable hours/week × 48 weeks = 1,200 hours/year.
3. Hourly Rate: $104,000 ÷ 1,200 hours = $86.67/hour.

Pro Tip: The Value-Based Alternative

Use the hourly rate calculated here as your "floor." If a project provides immense value to a client (e.g., a sales page that generates $100k in revenue), consider charging a flat project fee that exceeds your hourly minimum to capture the value you create.