How much should I charge per hour as a consultant or freelancer? Estimate your target hourly rate from your desired salary, overhead, taxes, and billable hours — or convert an hourly rate or project fee into real income.
Turn a target salary into the rate you must charge, project income from an hourly rate, or check what a project fee is really worth per hour.
Enter your desired annual income, overhead percentage, combined tax rate, and realistic billable hours. The calculator adds overhead and tax to your target salary, then divides by annual billable hours to find the rate you need to charge.
Enter your hourly rate, billable hours per week, working weeks per year, and tax rate. The calculator projects gross and after-tax annual income, plus monthly and weekly take-home pay.
Enter the fixed fee for a project and the hours it will take. The calculator divides the fee by the hours to show your effective hourly rate — essential for checking whether a flat fee is worth your time.
Verified examples using this calculator's exact formulas — results may round to cents.
Inputs: $100,000 desired annual income, 20% overhead, 30% tax, 25 billable hours/week, 48 working weeks/year
Calculation: $100,000 × 1.20 × 1.30 = $156,000 loaded target; 25 × 48 = 1,200 billable hours; $156,000 ÷ 1,200 = $130.00
Inputs: $130/hr, 25 billable hours/week, 48 working weeks/year, 30% tax
Calculation: $130 × 25 × 48 = $156,000 gross; × (1 − 0.30) = $109,200 after tax; ÷ 12 = $9,100 per month
Inputs: $5,000 project fee, 40 project hours
Calculation: $5,000 ÷ 40 = $125.00
Note: Examples are for illustration only; your actual rate depends on market, experience, and location.
Desired Annual Income — the take-home salary you want your consulting business to replace
Overhead % — business expenses (software, insurance, equipment, admin) as a percentage of income; 20% is a common start
Tax % — combined self-employment and income taxes; 30% is typical, varying by location and entity
Billable Hours/Week & Working Weeks/Year — hours you actually invoice (25 is realistic) and weeks you work (48 leaves room for vacation and holidays)
Pick the direction that matches your situation: Mode 1 when you know the income you want, Mode 2 to check whether a rate delivers it, Mode 3 when a client proposes a flat fee — always check the implied hourly rate first.
The defaults reflect a realistic solo consultant: 25 billable hours per week, 48 working weeks per year, 20% overhead, and 30% tax. Adjust them to your situation — especially billable hours, since overestimating them is the most common pricing mistake.
Every calculation produces a step-by-step breakdown of the math. Use the result as your pricing floor, then sanity-check it against market rates.
Remember: A calculated rate is a starting point, not a final answer. Compare it with the market and adjust for experience and niche. Review your rates at least once a year.
Most successful consultants blend at least two pricing methods. The cost-plus method starts with the salary you want to replace: add business costs, add taxes, then divide by the hours you can actually bill. This calculator automates that method — the best starting point, because it guarantees your rate covers expenses and delivers your target income.
The market-based method looks outward at what consultants with similar skills charge in your niche; industry reports and competitor rate cards give you a sanity range. The value-based method looks at the client: if your work saves a company $100,000, a $15,000 project fee is an easy yes.
A typical US rate ladder: junior generalists $40-75/hr, experienced specialists $75-150/hr, senior experts $150-250/hr, and niche or strategy experts $250-500+/hr. Your cost-plus number is the floor — the rate you need to survive; market research tells you what clients will actually pay.
The biggest mistake new consultants make is dividing their target income by 2,080 hours (40 × 52) and concluding they need a modest $50/hr. You cannot bill 40 hours per week: proposals, marketing, bookkeeping, admin, and meetings are all unbillable.
Typical utilization for solo consultants is 60-70% — 24 to 28 billable hours out of a 40-hour work week. Add vacation, holidays, and sick days (about 4 weeks per year), and a realistic annual total is 1,000 to 1,300 billable hours.
To measure your own utilization, divide billable hours by total working hours. If you are consistently under 60%, find what is eating your time: batch admin, automate proposals, shorten low-value meetings.
Hourly pricing is simple and easy to defend — but it punishes efficiency: the faster you work, the less you earn. It works best for ongoing support, maintenance, coaching, or work where the scope genuinely cannot be predicted.
Project pricing rewards efficiency and gives clients budget certainty. It works best when deliverables are well defined: a website, a report, a campaign, a course. The risk is scope creep — protect yourself with a written scope, a change-request process, and a clause that anything outside scope is billed separately. Use Mode 3 to check the implied hourly rate before agreeing to a flat fee.
A third option is the retainer model: a fixed monthly fee for a reserved block of hours (say, 10-20). Retainers give predictable income and client priority access, and work best for long-term relationships. Many consultants mix models — retainers for base income, project fees for growth, a higher hourly rate for ad hoc work.
⚠️ General Estimate Only: This calculator provides estimates based on the inputs you choose. Tax rates vary by location and entity structure — consult an accountant or tax professional for your situation. Your actual rate also depends on market demand, experience, and the value you deliver — treat results as a starting point, not a guarantee.
Review your rates regularly, track your utilization, and keep your overhead honest — understating overhead is one of the fastest ways to undercharge yourself.