Freelance Rate Calculator
Calculate the minimum hourly rate you need to charge as a freelancer to hit your income goal.
About the Freelance Rate Calculator
Freelancers rarely bill 40 hours a week — time goes to admin, marketing, and unpaid gaps between projects — so a rate that looks reasonable per hour can fall far short of a target income once you account for realistic billable hours. This calculator finds the minimum hourly rate needed to hit your income goal after expenses.
How It Works
The calculator adds your desired take-home income to your annual business expenses to find the total revenue you need to generate, then divides that by your realistic total billable hours for the year — billable hours per week multiplied by the number of weeks you actually work.
Minimum Hourly Rate = (Desired Income + Business Expenses) / (Billable Hours per Week × Weeks per Year).
Worked example
Scenario: A target income of $80,000, business expenses of $6,000, 25 billable hours a week and 48 working weeks.
- Amount to earn: $80,000 + $6,000 = $86,000.
- Billable hours per year: 25 × 48 = 1,200.
- Minimum rate: $86,000 ÷ 1,200 = $71.67 an hour.
Result: At least $71.67 per billable hour.
Build a sustainable freelance rate
A sustainable rate needs to cover more than take-home pay. Consider non-billable time, holidays, software, equipment, insurance, taxes, admin work, and the number of hours you can realistically invoice. Revisit the assumptions as your workload changes.
Tips and common mistakes
- Billable hours are usually 50–70% of working hours; admin, sales and learning take the rest.
- Add self-employment tax, health insurance and retirement savings to expenses, or set the income target before tax accordingly.
- Round up and build in a margin for slow months and unpaid invoices.
Assumptions & Limitations
- Assumes billable hours are the only hours generating revenue — unpaid admin, marketing, and sales time is excluded from the denominator on purpose.
- Business expenses are assumed to be paid out of billed revenue rather than a separate source.
- Does not account for self-employment taxes, retirement contributions, or health insurance, which many freelancers need to budget for separately on top of this rate.
- Assumes consistent billable hours every week, which real freelance work rarely delivers exactly.