Freelance hourly rate calculator
Start from what you need to earn and work back to a rate: your income, what the business costs, the weeks you don’t work, and the hours in a week you can actually bill.
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The rate to charge
$74.78 an hour
$86,000.00 to bring in, over 1,150 billable hours.
- Working weeks
- 46
- Billable hours in the year
- 1,150
- Income plus costs
- $86,000.00
- At 20 billable hours a week
- $93.48 an hour
- At 30 billable hours a week
- $62.32 an hour
How the rate is worked out
- Working weeks are 52 minus your weeks off.
- Billable hours in the year are working weeks times the hours you can bill in a week.
- What the hours must bring in is your income plus your business costs.
- The rate is that amount divided by the billable hours.
With the numbers the calculator starts on: 52 − 6 is 46 working weeks, times 25 is 1,150 billable hours. $80,000 plus $6,000 is $86,000, and $86,000 ÷ 1,150 is $74.78 an hour. They are example numbers, not a suggestion of what to earn or charge.
The number that matters most
Billable hours move the answer more than anything else. Nobody bills every hour they work: some of the week goes on email, estimates, bookkeeping and looking for the next client. Guess too high and the rate comes out too low to reach the income you entered.
What this leaves out
Once you have a rate, the free invoice generator multiplies it by your hours, and the invoice templates show how others in your line of work lay out what they bill.
Questions
How do I work out a freelance hourly rate?
Add the income you want in a year to what your business costs to run, then divide by the hours you can bill in a year. Billable hours are the weeks you work times the hours in each week you can charge to a client, which is fewer than the hours you work.
Why not divide a salary by 2,080 hours?
2,080 is 40 hours a week for 52 weeks, with every hour paid. A freelancer isn’t paid for holidays, sick days, admin or the time spent finding work, and pays the business’s costs. Dividing by billable hours instead gives a rate that reaches the income you were aiming at.
How many billable hours a week is realistic?
It varies with the kind of work and how much of your week goes on calls, email, admin and finding clients. Track a typical month before you trust a number. The calculator shows the rate at five hours more and fewer, so you can see how much the answer depends on it.
Does the rate include taxes?
The income figure is before tax. If you want the rate to cover things an employer would have paid for, such as health insurance or retirement contributions, add them to the costs.
The numbers are the easy part. Sandglass writes the invoice lines from your notes.
Free plan: 3 drafted invoices a month. No card.