Freelance Rate Calculator
Calculate your ideal freelance hourly rate based on desired income, expenses, taxes, and billable hours.
Your Freelance Rate
Recommended Hourly Rate
$98.21
per hour
Daily Rate
$785.71
Weekly Rate
$2,946.43
Monthly Rate
$11,785.71
Annual Revenue
$141,428.57
How to Set Your Freelance Rate
Setting your freelance rate requires more than just picking a number. You need to account for self-employment taxes, health insurance, retirement savings, business expenses, non-billable hours, and a profit margin for business growth.
A common mistake is simply matching a salaried equivalent. As a freelancer, you typically need to charge 40-60% more than an equivalent salary to cover the benefits and taxes that employers normally provide.
Formula
Hourly Rate = (Income + Expenses) ÷ (1 - Tax Rate) × (1 + Profit Margin) ÷ Billable HoursThis formula ensures your rate covers your desired take-home pay, business costs, taxes, and provides for business growth.
Where:
- Income = Your desired annual take-home income
- Expenses = Annual business expenses (software, equipment, etc.)
- Tax Rate = Combined self-employment and income tax rate
- Profit Margin = Extra percentage for savings and growth
- Billable Hours = Hours per week × Weeks worked per year
Frequently Asked Questions
How do I calculate my freelance hourly rate?▼
Add your desired income plus business expenses, account for taxes, add profit margin, then divide by your total billable hours per year. Our calculator does this automatically.
Why is my freelance rate higher than a salary equivalent?▼
Freelancers must cover their own taxes (self-employment tax ~15.3%), health insurance, retirement, equipment, software, and non-billable hours (marketing, admin, etc.).
What are billable hours?▼
Billable hours are the hours you can charge clients for. Most freelancers can bill 25-30 hours per week, as the rest is spent on admin, marketing, and business development.
How many weeks should I plan to work?▼
Most freelancers plan for 46-50 working weeks per year, accounting for vacation, sick days, and holidays. Being conservative here helps avoid undercharging.
Should I charge by the hour or by the project?▼
Both approaches work. Hourly rates are simpler to calculate, while project-based pricing can be more profitable once you work efficiently. Use your hourly rate as a baseline for estimating project costs.
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