Freelance Hourly Rate Calculator — What Should You Charge?

Most freelancers undercharge because they price against a salary instead of a business. This free calculator works out the hourly rate you actually need from four inputs: target annual income, business expenses, billable hours, and profit margin. (The interactive calculator loads with the app.)

How the calculation works

Hourly rate = (desired income + annual expenses) ÷ billable hours × (1 + profit margin)

Example: you want $70,000/year, spend $8,000 on software, insurance, and equipment, can bill 1,200 hours per year, and want a 20% margin. ($70,000 + $8,000) ÷ 1,200 × 1.2 = $78/hour.

Why billable hours are lower than you think

• A 40-hour week is not 40 billable hours — admin, marketing, and proposals typically consume 30–40%
• Most full-time freelancers realistically bill 1,000–1,400 hours per year
• Holidays, sick days, and gaps between clients reduce it further

Costs freelancers forget to include

• Self-employment taxes and retirement contributions
• Health insurance and equipment replacement
• Software subscriptions and professional development
• Unpaid time: revisions, meetings, and scope creep

After you set your rate

Put it to work: read our freelance pricing strategies guide, then invoice professionally with the free freelancer invoice generator.