Question 1

How do I calculate my freelance hourly rate?

Accepted Answer

Start with your desired annual income, add taxes (~30%), health insurance, retirement, and business expenses. Divide by billable hours (typically 1,000–1,500/year, not 2,080). A $70,000 target income often requires a $50–$70/hour rate.

Question 2

Why can't I just charge my old hourly rate as a freelancer?

Accepted Answer

As an employee, your employer covered half of FICA (7.65%), health insurance, retirement matching, PTO, and overhead. As a freelancer, you pay all of that yourself. You need to charge 40–60% more to match your old take-home pay.

Question 3

How many billable hours should I plan for?

Accepted Answer

Most freelancers bill 60–70% of their working time. The rest goes to admin, marketing, invoicing, and business development. At 30 billable hours/week and 48 working weeks, that's about 1,440 billable hours/year.

Question 4

How do I convert my hourly rate to a project price?

Accepted Answer

Estimate total hours for the project, multiply by your hourly rate, then add a 15–20% buffer for scope changes and revisions. A 40-hour project at $60/hour = $2,400 base, plus buffer = $2,760–$2,880.

Question 5

What freelance rate do I need to match a $100,000 salary?

Accepted Answer

To match a $100,000 salary with benefits, you'd need roughly $140,000–$160,000 in gross freelance revenue. At 1,200 billable hours/year, that's $117–$133/hour.

Question 6

Should I charge hourly or per project?

Accepted Answer

Both have trade-offs. Hourly protects you when scope changes, but caps your earnings. Project pricing rewards efficiency and feels cleaner to clients. Many freelancers start hourly and move to project pricing as they get better at estimating.

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