Freelance Hourly Rate Calculator
Determine exactly what you need to charge to meet your income goals.
The net salary you want to take home.
Software, insurance, hardware, rent, taxes.
Total hours you sit at your desk.
Vacation, sick days, and holidays.
Percentage of work time actually billed to clients (excludes admin, marketing, etc). Standard is 60-75%.
Total Revenue Needed:
$0
Total Billable Hours:
0
Minimum Hourly Rate:
$0.00
How to Calculate Your Per Hour Rate Effectively
Calculating your freelance or consulting hourly rate is not as simple as taking your desired salary and dividing it by 2,080 (the standard number of work hours in a year for an employee). This "employee mindset" calculation often leads to freelancers undercharging and struggling to cover their overheads.
To calculate a sustainable per-hour rate, you must account for three critical factors that employees generally do not worry about:
- Non-Billable Time: You cannot bill clients for the time you spend finding new clients, doing your taxes, updating your website, or answering emails. Typically, only 60% to 75% of your work week is actually billable.
- Business Overheads: Your rate must cover not just your salary, but your software subscriptions, health insurance, self-employment taxes, laptop upgrades, and office costs.
- Unpaid Time Off: Unlike traditional employment, freelancers do not get paid holidays or sick leave. Your hourly rate must be high enough to accrue a buffer for the weeks you are not working.
The Math Behind the Calculation
This calculator uses a reverse-engineering approach to determine your rate. It starts with your financial targets and works backward through your time constraints:
(Desired Salary + Overhead Costs) ÷ (Available Work Weeks × Hours per Week × Billable Efficiency) = Minimum Hourly Rate
By inputting your specific data points above, you ensure that every hour you bill contributes proportionally to your annual financial goals, covering both your lifestyle and your business expenses.