Freelance Rate Calculator

Setting the right rate is important for your success and sustainability. Your rate affects your income, reflects your work's value, and ensures you cover expenses while avoiding financial stress and burnout. Charging too little undervalues your skills, while charging too much can make it challenging to attract and retain clients. A well-calculated rate ensures that you can cover your business and personal expenses, save for the future, and invest in your professional growth. 

Follow this guide to determine an hourly rate that meets your needs and accurately reflects your worth. 

Calculate Your Expenses

 - Fixed Monthly Expenses: Rent, utilities, health insurance, software subscriptions, internet service, etc.

   - Variable Expenses: Work supplies, travel, ads, personal care, investment contributions, entertainment subscriptions, savings, etc.

Determine Your Desired Annual Income

First, calculate your billable hours.

   - Billable Hours

• Total working hours in a year (e.g., 40 hours/week × 52 weeks (number of weeks in a year) = 2,080 hours).
• Subtract non-billable hours (e.g 5 vacation days + 7 sick days + 3 networking event days + 2 training session days + 4 public holidays, etc.) = 520 hours).

   - Example: 2,080 total hours - 520 non-billable hours = 1,560 billable hours.

Add a Profit Margin

Consider adding a profit margin (e.g., 10-20%) to ensure business growth and unexpected expenses.

Calculate Your Hourly Rate

  - Formula: [(Annual Expenses + Desired Annual Income) / Billable Hours] + Profit Margin]

Here’s what the calculation from the example above would look like: 

     - Annual Expenses: $20,000

     - Desired Annual Income: $60,000

     - Billable Hours: 1,560

     - Profit Margin: 20%

To get your hourly rate: [($20,000 + $60,000) / 1,560] + 20%].

The final result is $61.54/hour.

Now you have an idea of how much you should be charging, and you can adjust your rates anytime. Also keep in mind that some factors (like the scope of work, your experience level, location, client’s budget and industry standards, competition) can affect the rate you set. 

How to receive payment for your gigs easily

Make it easy for your clients to pay you and for you to get your funds quickly by using a virtual multi-currency wallet that lets you accept payments in different currencies. Click here to sign up on Geegpay and get a USD, EUR, GBP, and local virtual bank account instantly and a virtual dollar card for global expenses.