Hourly Rate Calculator

Your Recommended Rates

Hourly Rate

$79.44

per billable hour

Daily

$636

8 hours

Weekly

$1,986

25 hours

Monthly

$7,944

average

Annual Breakdown

Desired take-home $60,000
Business expenses + $5,000
Profit margin (10%) + $6,500
Estimated taxes (25%) + $23,833
Total revenue needed $95,333
Divided by 1,200 billable hours/year

Pro Tip

Most freelancers only bill 50-70% of their work hours. The rest goes to admin, marketing, and learning. Adjust your billable hours accordingly!

Income Goal

$

What you want to pay yourself after business expenses

Quick presets

Business Expenses

$

Software, equipment, insurance, marketing, etc.

Billable Hours

25 hrs
5 hrs Part-time Full-time 50 hrs
48 weeks
20 weeks Accounting for vacation, holidays, sick days 52 weeks

1,200 total billable hours per year (25 × 48)

Taxes & Profit Margin

25%

Include self-employment tax (~15%) plus income tax

10%

Extra buffer for business growth, emergencies, and savings

How to Calculate Your Hourly Rate

1

Set Your Income Goal

Enter your desired annual take-home pay - what you want to pay yourself after all business expenses.

2

Add Business Expenses

Include software subscriptions, equipment, insurance, marketing, and other annual business costs.

3

Estimate Billable Hours

Set realistic billable hours per week (typically 50-70% of work hours) and weeks worked per year.

4

Account for Taxes & Profit

Add your estimated tax rate and desired profit margin to ensure you're charging enough.

Frequently Asked Questions

How do I know how many hours are billable?
Most freelancers can only bill 50-70% of their total work hours. The rest is spent on admin tasks, marketing, invoicing, learning, and business development. If you work 40 hours a week, you might realistically bill 20-28 hours. Track your time for a few weeks to get accurate data.
What tax rate should I use?
In the US, self-employed individuals pay self-employment tax (~15.3%) plus income tax (10-37% depending on bracket). A safe estimate for most freelancers is 25-35%. Consult a tax professional for your specific situation.
Why include a profit margin?
A profit margin gives you a buffer for unexpected expenses, slow periods, business investments, and retirement savings. It also helps you transition from trading time for money to building real business value. 10-20% is a good starting point.
Is this hourly rate calculator free?
Yes, this hourly rate calculator is completely free with no signup required. Use it as many times as you need to find the right rate for your freelance or consulting business.
What if my calculated rate seems too high?
If your rate seems high compared to market rates, you have options: reduce your income goal, cut business expenses, increase billable hours (be careful not to burn out), or specialize to justify higher rates. Remember, your rate should reflect the value you provide, not just your costs.
Should I charge different rates for different clients?
Many freelancers do adjust rates based on project complexity, client budget, timeline urgency, or value delivered. Your calculated rate should be your baseline minimum. For high-value projects or demanding clients, charge more. For long-term retainers, you might offer a small discount.