About this calculator
Hourly rate confusion is the most common cause of underpaid freelance work. Dividing salary by billable hours ignores business costs, unpaid admin time, and taxes, so the number you arrive at is always too low.
How it works
This calculator works from your target income outward: it grosses up for tax, adds business costs, applies your margin, then divides by realistic billable hours. The result is the true floor below which every hour costs you money.
Frequently asked questions
How do I calculate my freelance hourly rate?
Add your target income and business costs, gross the total up for taxes, then divide by the hours you can realistically bill. A 1400-hour year is realistic for full-time freelancing; 2000 hours is not.
What is a reasonable hourly rate as a freelancer?
Most sustainable freelance practices land between $75 and $200 per hour depending on specialty and market. Below $50 you are rarely covering business overhead unless costs are unusually low.
How many billable hours should I plan for?
Plan for 1,000 to 1,500. Of roughly 2,000 working hours, expect 40 to 50% to go to admin, invoicing, marketing, networking, and professional development that is not billable.
Should I charge hourly or project fees?
Hourly suits ongoing or uncertain work. Project fees suit well-defined deliverables where you have an efficiency advantage. Many practices use hourly for scoping and fixed price once the scope is agreed.
How do I raise my rates without losing clients?
Raise prices for new clients first, keep existing contracts, and raise by 10 to 20% at renewal with clear justification around the value delivered. Grandfathering old clients is a reasonable transition.
What is the value of unpaid time in my rate?
Admin, sales, and marketing are real costs of running a practice. If you do not price them, you are effectively working for free. Include them in the billable-hours denominator rather than ignoring them.