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How to calculate your freelance rate
Figuring out how much to charge as a freelancer is one of the most important decisions for your business. It's not just about covering expenses — you need to factor in your income goals, business costs, non-billable time, and vacation.
The formula
The calculator uses a simple but comprehensive formula:
- Add up your monthly needs: desired profit + personal costs + business costs
- Multiply by 12 to get your annual requirement
- Calculate your billable hours: work weeks (52 - vacation weeks) x hours per week
- Divide: annual requirement / billable hours = your hourly rate
Common mistakes when setting your rate
Not accounting for non-billable time
Not every working hour is billable. Sales, admin, bookkeeping, marketing — that's all time you can't charge for directly. That's why the calculator uses "billable hours" rather than "working hours".
Forgetting business costs
Software, equipment, coworking, internet, insurance, estimated taxes — these costs eat into your real income. Include them in "business costs" so your rate covers them.
Not taking time off
Working 52 weeks a year isn't sustainable. The calculator automatically deducts your vacation days so your rate reflects a realistic work pace.
Manage your freelance projects
Get helps you budget, invoice, and manage clients in one place. Perfect for freelancers and creative studios.
Try for freeFAQ
How many billable hours should I plan for?
Most freelancers bill between 20-30 hours per week. The rest goes to admin, sales, and professional development. If you're just starting out, 20 hours is more realistic.
Should I charge different rates for different projects?
Your base rate should cover your costs and goals. You can adjust upward for urgent, complex, or high-value projects. Never go below your base rate.
How often should I recalculate my rate?
Review your rate every 6 months or whenever your costs change significantly. Also recalculate when you level up in experience or switch niches.