This free calculator turns your yearly income goal, business costs and realistic billable hours into a target hourly rate, then multiplies it by a typical project length to suggest a project rate. It is for freelancers and solo consultants who want a repeatable starting number instead of pricing by gut feeling.
Free version: it runs in your browser — nothing you type leaves your device.
How to use the free calculator
- Enter the yearly income you want to take home before taxes.
- Add your yearly business costs, such as software, tools, insurance and equipment.
- Enter the billable hours you can realistically work in a year, not total working hours.
- Enter the hours a typical project takes.
- Read your target hourly rate and suggested project rate, then copy or print the result.
How the calculation works
The calculator adds your target yearly income before taxes to your yearly business costs. That total is the amount your work has to cover. It then divides that total by your billable hours per year to get your target hourly rate. The suggested project rate is simply that hourly rate multiplied by the hours a typical project takes.
In plain words: target hourly rate equals (income goal plus business costs) divided by billable hours. Project rate equals target hourly rate times project hours. A full-time year is about 2,080 hours, but billable time is usually lower once you subtract admin, sales, learning and time off, so enter a number you can actually bill.
Worked example with round numbers: suppose you want 60,000 in take-home income before taxes and your business costs are 6,000 a year. That is 66,000 to cover. If you can bill 1,200 hours in a year, your target hourly rate is 55. A project that takes 10 hours would then suggest a project rate of 550.
Common mistakes: using total working hours instead of billable hours, which makes the rate look lower than it needs to be; forgetting recurring costs like software subscriptions or insurance; and leaving out slow months by assuming you bill every week of the year. The result is an educational estimate, not financial advice, so adjust the numbers to match your own situation.
Frequently asked questions
How do I calculate my freelance hourly rate?
Add your target yearly income before taxes to your yearly business costs, then divide by the billable hours you can realistically work in a year. The result is the hourly rate your work needs to cover both your income and your costs.
What counts as billable hours for a freelancer?
Billable hours are the hours you actually charge a client for. A full-time year is about 2,080 hours, but time spent on admin, sales, learning and time off is usually not billable, so your billable number is typically lower.
How is the suggested project rate calculated?
The calculator multiplies your target hourly rate by the number of hours a typical project takes. If your hourly rate is 55 and a project takes 10 hours, the suggested project rate is 550.
Should I include software and insurance costs in the calculator?
Yes. Software, tools, insurance and equipment are business costs your rates have to cover, so add them to your yearly costs. Leaving them out makes the hourly rate look lower than it really needs to be.
Does the calculator work offline?
The free calculator runs in your browser and needs no installation. The paid version is an interactive file that works offline in any browser, so you can keep it on your computer and use it whenever you review your rates.
Free educational tool made with the help of AI and tested automatically on desktop and mobile. Results are estimates. Not financial advice.
