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Freelance Pricing Calculator
Estimate the minimum hourly rate you need to charge to cover your take-home income target and operating costs, with a buffer for profit. Adjust any input and the results update instantly.
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Formulas & Assumptions
The calculation is deliberately transparent. All amounts are annual unless stated; the two percentage inputs are converted to decimals before use (60% becomes 0.6).
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billableHours = hoursPerWeek × weeksPerYear × billableRatioBillable hours = hours per week × working weeks per year × billable ratio. This is the time you can actually invoice.
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requiredRevenue = (incomeGoal + expenses) / (1 − profitMargin)Required revenue = (income goal + business expenses) ÷ (1 − profit margin). Your revenue must cover owner pay, operating costs and a profit buffer.
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hourlyRate = requiredRevenue / billableHoursHourly rate = required revenue ÷ billable hours. If billable hours are zero or negative, the rate is reported as zero to avoid a divide-by-zero.
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monthlyRevenueTarget = requiredRevenue / 12Monthly revenue target = required revenue ÷ 12. A simple annual-to-monthly split for cash-flow planning.
Revenue, income and profit are not the same thingRevenue (required revenue) is the total you bill clients. From it come your operating costs (expenses) and your take-home income goal (income goal). The profit margin is a percentage buffer kept on top of revenue — it is not your salary and not the same as take-home pay. This tool keeps all three separate so a higher income goal never gets mistaken for "profit".
Assumptions & limits
- Target profit margin is clamped to a maximum of 90% so the denominator (1 − margin) can never be zero or negative.
- Billable ratio is clamped to 0–100%, weekly hours to 0–168 and working weeks to 0–53. If billable hours fall to zero, the recommended hourly rate is shown as zero.
- Amounts are pre-tax and ignore income tax, VAT/sales tax, payment-processing fees and currency effects. Apply your local tax rules separately.
- Results assume a stable mix of clients and hours across the year. They are a floor for planning, not a market rate — adjust for demand, positioning and project risk.
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How to use
- Set an annual income goal: the pay you want to take home, before tax.
- Add up a full year of operating costs, not just obvious monthly subscriptions.
- Be honest about working hours, weeks and the share of time you can actually bill.
- Read the recommended hourly rate as a floor, then compare it with your market and round up.
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Related Reading
This calculator provides general planning estimates for independent professionals. It is not financial, tax or legal advice, and makes no guarantee about rates, earnings or client outcomes.