Free calculator
What should your hourly rate be?
Work backwards from the income you actually want, not from what a competitor charges.
The formula
Hourly rate = (income target + business expenses) ÷ (billable hours per week × weeks worked per year)
Worked example
| Input | Value |
|---|---|
| Income you want to take home (per year) | $60,000.00 |
| Business expenses to cover (per year) | $12,000.00 |
| Billable hours per week | 25 |
| Weeks worked per year | 46 |
| Output | Value |
|---|---|
| Day rate (8 billable hours) | $500.87 |
| Monthly revenue at this capacity | $6,000.00 |
| Billable hours per year | 1,150 |
| Total you must cover | $72,000.00 |
Things worth knowing
- Billable hours is where most freelancers fool themselves: 40 worked hours usually means 20-28 billable ones.
- If you want holiday, sick leave and pension, add them into the income target — nobody else covers them.
Related
These are arithmetic tools, not financial advice. Currency symbols are for display only — the maths is currency-agnostic. Last reviewed: 2026-10-27.