Your numbers
Your results
This is your floor, not your goal. It covers your target pay, taxes, and expenses at your real billable capacity.
| Measure | Amount |
|---|---|
| Annual gross revenue needed | - |
| Billable hours per year | - |
| Monthly gross needed | - |
| Monthly take-home (target) | - |
| Naive 2,080-hour rate (for comparison) | - |
| Suggested project price (hours above) | - |
Frequently asked questions
What is the formula for a freelance hourly rate?
Hourly rate = (target take-home pay + taxes + business expenses) / realistic billable hours per year. The denominator is the part people get wrong: use the hours you can actually invoice, not 2,080.
How many billable hours does a freelancer really have?
Most full-time freelancers bill 1,000 to 1,400 hours per year, or roughly 20 to 27 hours a week across 48 working weeks. The rest of a 40-hour week goes to proposals, admin, marketing, learning, and gaps between projects.
Why is my calculated rate so much higher than my old salary divided by 2,080?
Because salary math hides three costs: the hours you work but cannot bill, the taxes and insurance your employer used to pay, and the time off you now fund yourself. A $70,000 salary equivalent often needs a $85-$95/hour freelance rate. That gap is real, not greed.
Should I charge hourly, daily, or per project?
Use your hourly rate as the internal planning number, then quote in whatever shape the client buys best: hourly for open-ended support, day rate (hourly x 8) for intensive blocks, and fixed project fees for defined deliverables. Just make sure every quote traces back to the same floor rate.
What tax rate should I use?
US freelancers commonly set aside 25-35% of income for federal and state income tax plus self-employment tax (15.3%). Use a cautious planning number here; this is not tax advice, and your actual liability depends on your situation.
Is this rate my ceiling?
No. This is your floor: the rate below which you are losing money against your own goals. As your skills, demand, and reputation grow, charge above it. Many freelancers add a 20-30% margin on top for savings, retirement, and slow periods.
Guides
- Why Most Freelancers Undercharge by 40% (The Billable Hours Trap)
The 2,080-hour mistake, a $70K worked example, and the three costs salary math hides from you.
- Freelance Day Rate vs Hourly Rate: When to Use Each
How to convert your hourly floor into day rates and project fees without guessing, and when each one wins.