How to work out your hourly rate
Don't start from what others charge. Start from what you need to live on, then work back. As a freelancer you pay your own taxes, software, gear and insurance, and you aren't paid for holidays, sick days or the hours spent finding work.
The formula
Revenue needed = take-home ÷ (1 − tax rate) + business costs. Hourly rate = revenue ÷ ((52 − weeks off) × billable hours a week).
For $60,000 take-home at a 25% tax rate with $6,000 in costs: $60,000 ÷ 0.75 + $6,000 = $86,000. With 6 weeks off and 25 billable hours a week, that's 1,150 hours, so $74.78 an hour.
Billable hours matter most
A 40-hour week isn't 40 billable hours. Emails, invoicing, pitching and your own content eat a big share. Many freelancers bill 20 to 30 hours a week; planning on 40 sets a rate that's too low and a schedule you can't keep.
Turning it into day and project rates
A day rate is your hourly rate × 8. For projects, estimate the hours honestly, add a buffer of 15% to 25% for revisions and back-and-forth, and quote a single price. Clients prefer a fixed number, and if you get faster, you keep the difference.
Frequently asked questions
How do I calculate my freelance hourly rate?
Add your target take-home pay grossed up for tax to your yearly business costs, then divide by the hours you can bill in a year (working weeks × billable hours a week).
How many billable hours a week is realistic?
For most freelancers, 20 to 30. The rest of the week goes on admin, finding clients and learning.
What tax rate should I use?
It depends on where you live. In the US, self-employment tax is 15.3% on top of income tax, so many freelancers set aside 25% to 30%. An accountant can give you a better number.
Should I charge hourly or per project?
Use your hourly rate to price, but quote per project when you can. Clients like knowing the total, and you're rewarded for working efficiently.