Free Freelance Hourly Rate Calculator
Are you charging what you’re truly worth? One of the biggest challenges for freelancers is calculating the right hourly rate. Our simple calculator takes the guesswork out of it. Enter your desired income, expenses, and work hours to find the minimum hourly rate you need to build a sustainable freelance business.
Why You Shouldn’t Just Guess Your Hourly Rate
- Burnout: Working long hours for low pay.
- Hidden Costs: Forgetting to factor in taxes, software, and non-billable time.
- Lack of Growth: Not having enough profit to invest back into your business.
Calculating your rate is the first step. To learn how to present it to clients, read our Guide to Pricing Your Freelance Services
How This Calculator Works (The Formula)
Our calculator uses a standard formula trusted by professional freelancers:
((Desired Annual Income + Total Annual Expenses) / (Total Billable Hours Per Year)) 1.20 = Your Target Hourly Rate
We automatically factor in your vacation time and add a 20% buffer to your minimum rate. This “profit margin” is crucial for covering unexpected costs and investing in your business growth.
Frequently Asked Questions (FAQ)
Why shouldn’t I charge by the hour?
While calculating your hourly rate is essential for internal planning, we often recommend charging clients on a per-project or value basis. An hourly rate can punish you for being efficient. Our calculator helps you find your minimum rate to ensure profitability.
What should I include in “Business Expenses”?
Include any cost required to run your business: software subscriptions (Adobe, etc.), web hosting, marketing costs, accounting software, and a percentage for self-employment taxes (typically 25-30%).
How often should I recalculate my rate?
It’s a good practice to review and recalculate your hourly rate at least once a year, or anytime your income goals or business expenses change significantly.