Freelancer Hourly Rate Calculator

As a freelancer, you pay for benefits that employers typically cover — health insurance, retirement contributions, self-employment tax (the employer half of Social Security and Medicare), paid time off, and business expenses. You also spend significant time on non-billable work like marketing, invoicing, and admin. A common rule of thumb is to charge 2-3x the equivalent employee hourly wage.

Most freelancers find that only 50-70% of their working time is billable. The rest goes to finding clients, writing proposals, invoicing, admin tasks, marketing, and professional development. A common starting estimate is 60%, but this varies by industry and experience level.

Many experienced freelancers prefer project-based or value-based pricing because it decouples your income from hours worked. However, knowing your hourly rate is essential as a baseline — it helps you evaluate whether a project is worth your time and ensures you don't accidentally under-charge on flat-fee projects.

Self-employment tax is the freelancer's version of FICA (Social Security + Medicare). As an employee, you pay 7.65% and your employer matches it. As a freelancer, you pay both halves — 15.3% total on the first $168,600 of net earnings (2024). You can deduct the employer half when calculating income tax.