What Should I Charge as a Freelancer?
New freelancers often set a rate by taking a salary and dividing by 2,080 hours — and quietly go broke. That math ignores three things: you don't bill every hour you work, you pay your own taxes, and you cover your own expenses. This calculator works backward from the take-home income you actually want, grosses it up for taxes and expenses, and divides by the hours you can realistically invoice.
Billable hours are the catch
A full-time employee is paid for 40 hours regardless of what they do. A freelancer only earns during billable hours — the ones a client actually pays for. Sales calls, admin, invoicing, learning, and marketing are all unpaid. For most freelancers, only half to two-thirds of the working week is billable, which is why entering 25 billable hours rather than 40 produces a far higher — and more honest — rate.
Don't forget taxes and expenses
As a self-employed worker you set aside your own taxes, often 25-30% once self-employment tax is included, and you fund your own software, equipment, insurance, and downtime. Both belong in your rate. The result may look high next to an hourly wage, but it isn't apples to apples — it has to cover everything an employer would otherwise provide. Round up from the calculator's figure to leave room to negotiate.
Frequently asked questions
- How do I calculate my freelance rate?
- Start from your take-home goal, add expenses, gross up for taxes, then divide by the hours you can actually bill.
- Why can't I just divide a salary by 2080?
- Because you don't bill every hour and you pay your own taxes and expenses. That method underprices you badly.
- What percent of my week is billable?
- For most freelancers, half to two-thirds. The rest goes to admin, sales, and learning.