Freelance hourly rate calculator

The calculation

working weeks   = 52 − weeks off
annual hours    = working weeks × hours per week
billable hours  = annual hours × billable percentage
revenue needed  = desired income + business expenses
revenue target  = revenue needed × (1 + buffer)
hourly rate     = revenue target ÷ billable hours

This is your floor, not necessarily your price

The number tells you what the maths requires under the assumptions you entered. It does not tell you what a client will pay. Your actual rate may also depend on your experience, demand, how specialised the work is, the value of the project, the type of client, how much risk you carry, and whether you price by hour, project or retainer.

If the calculator says 90 and your market comfortably supports 140, there is no reason to charge 90 because a spreadsheet said so.

If the market will only pay 60, the useful part is knowing that your current assumptions do not add up. Something has to change.

Billable hours are not working hours

Suppose you work 40 hours in a week. That does not mean you have 40 hours available to invoice.

Some of that week disappears into proposals, sales calls, invoicing, bookkeeping, email, planning, marketing, learning, fixing your own website and general admin.

That is why the billable percentage has such a large effect on the result. Overestimate it and the rate looks healthier on paper than it feels in practice.

It is worth dragging that slider around. If the plan only works at 90%, it is fragile. If it still works at a conservative number, you have room for the work involved in actually running the business.

Your rate and your effective rate are not the same

You may charge a client 100 per hour and still earn less than 100 per hour from the relationship. You invoice five hours, then spend unbilled time on calls, revisions, preparation, admin and project management. Your advertised rate is still 100. Your effective rate is lower.

This is one reason a reasonable record of your time is useful even when every minute is not billable — and it is what turns the assumptions above into figures you have actually measured.

Fixed-fee freelancers can use this too

You do not need to invoice by the hour for an hourly rate to be useful internally. Charge 2,000 for a project that takes 20 hours and your effective rate is 100 an hour. If the next one takes 40 hours for the same fee, it is 50.

In Tidst a client can be set to a fixed fee rather than an hourly rate, and the agreed amount is divided by the hours logged against it — so that second number is measured rather than estimated. Knowing your baseline requirement from the calculator above helps you judge whether a fixed price is likely to work before you quote it.

A minimum is not a comfortable rate

The result is a baseline built from your assumptions. Real freelance businesses have messy months: a client disappears, a project slips, equipment breaks, an invoice is paid late, you take an extra week off.

That is what the buffer is for. You may also simply want the business to make a profit beyond your own income and its operating costs.

There is nothing wrong with charging more than the minimum.

Check whether the rate survives real work

A rate can look perfect in a calculator and still fail in practice if the work consistently takes longer than expected. That is where the time record matters — knowing how much time a client actually consumed, how much of it was billable, and how much revenue the work generated lets you compare the plan with what really happened.

Tidst is built for that part: keeping a usable record of freelance time without relying only on memory.