Freelance Hourly Rate Calculator
The take-home pay you want after expenses.
Software, hardware, insurance, office rent.
Excluding vacation, sick days, and holidays.
Hours spent on actual client work (not admin).
Recommended Hourly Rate
$0.00
Weekly Target
$0.00
Monthly Target
$0.00
Total Annual Goal
$0.00
How to Calculate Your Freelance Hourly Rate
Setting the right price for your services is one of the most critical steps in running a successful freelance business. Many freelancers make the mistake of simply matching a previous employer's hourly wage, but this fails to account for the overhead and non-billable time inherent in self-employment.
The Freelance Rate Formula
To ensure you cover your lifestyle and business needs, we use the Required Revenue Formula:
(Desired Salary + Business Expenses) / (Billable Weeks × Billable Hours) = Hourly Rate
Key Factors to Consider
- Non-Billable Time: You won't spend 40 hours a week on client work. Between invoicing, marketing, and sales, most freelancers only bill 20-30 hours per week.
- The "Self-Employment Tax": Remember that you are responsible for both the employer and employee portions of social security and Medicare.
- Overhead: This includes your laptop, software subscriptions (Adobe CC, Zoom, CRM), and your home office setup.
- Profit Margin: Once you cover your salary and expenses, adding a 10-20% profit margin allows you to reinvest in your business.
Real-World Example
If a Graphic Designer wants to earn $60,000 a year, has $4,000 in annual expenses, takes 4 weeks of vacation (48 weeks total), and spends 25 hours a week on design work:
($60,000 + $4,000) / (48 weeks × 25 hours) = $64,000 / 1,200 hours = $53.33/hr.