I Built a Free Freelance Rate Calculator - Here's Why Most Freelancers Undercharge

The Problem

When I started freelancing, I made the classic mistake: I took my desired annual salary and divided it by 2,080 hours (40 hours × 52 weeks).

$80,000 ÷ 2,080 = $38.46/hour

Seemed reasonable, right? Wrong.

I was actually earning way less than $80K because I forgot about:

• 🏥 Taxes (self-employment tax is ~15% on top of income tax)
• 💼 Business expenses (software, equipment, coworking, insurance)
• 🏖️ Time off (vacation, sick days, holidays)
• ⏰ Non-billable hours (admin, marketing, invoicing)

The Solution

I built FreelanceHourly — a free calculator that factors in ALL of these variables.

How it works:

1. Enter your target annual income
2. Add your monthly business expenses
3. Set your tax rate
4. Specify vacation/sick days
5. Get your real minimum hourly rate

The Math Behind It

Here's the simplified formula:

Real Rate = (Target Income + Taxes + Expenses) ÷ Actual Billable Hours

For that $80K example with:

• 30% effective tax rate
• $500/month expenses
• 4 weeks off per year
• 70% billable time

Real rate needed: ~$75/hour (not $38!)

Try It Out

🔗 FreelanceHourly.site — completely free, no signup required.

Would love your feedback! What factors do you consider when setting your rates?

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Built with vanilla HTML/CSS/JS. Inspired by years of undercharging myself.