Freelance Rate Calculator
Don't just divide your salary goals by 2,000 hours. Calculate your true hourly rate including expenses, taxes, unbillable time, and profit margin.
Frequently Asked Questions
Why should I include a profit margin as a freelancer?
Your salary pays you for the work you do. The profit margin pays the business for taking risk, financing growth, and covering slow periods. Treat your freelance practice like a real company.
Why are my billable hours assumed to be lower than 40?
Because you also run the business. You must do marketing, sales calls, accounting, and admin work. Most freelancers average 20-25 billable hours maximum per week.
The Real Cost of Freelancing
A common mistake is taking the total salary you want (e.g., $100k) and dividing it by 2000 hours (50 weeks * 40 hours) to get $50/hour. This fails to account for taxes, unbillable administrative work, equipment expenses, software subscriptions, healthcare, and vacation time.
Pricing for Sustainability
True hourly rates must be dramatically higher than typical W-2 hourly rates. If you price too low, you are subsidizing your client's business with your own lack of benefits and structural security.