What should I charge for freelancing?
Most freelancers set their rate by guessing or copying someone else. The math should run the other way: start from the take-home income you actually need, add self-employment tax, income tax, software, insurance, and unpaid admin time — then see what each billable hour really has to earn.
| Gross revenue you need to bill | – |
| Business expenses | – |
| Self-employment tax (15.3%) | – |
| Federal income tax (est.) | – |
| State income tax (est.) | – |
| Retirement savings | – |
| Your take-home income | – |
For projects: estimate the hours the job will take, multiply by your hourly rate above, then add materials (with markup) and a 10–25% buffer for overruns.
Estimates use 2025 federal brackets, the standard deduction, and an approximate state rate. Local taxes, credits, and deductions beyond the standard deduction are not included. Not tax advice.
What to count as expenses
For freelancing, annual business expenses typically include software subscriptions, a laptop upgrade every few years, health insurance, coworking or home-office costs, accounting fees, and marketing. Add up a full year of these — using a rough annual total is far better than entering zero and pricing your overhead at nothing.
Be honest about billable hours
A full-time freelancer rarely bills 40 hours a week. Between proposals, invoicing, email, and finding the next client, 20–28 truly billable hours a week is normal. If you assume 40, your rate will come out dangerously low.
Freelancer pricing FAQs
Why is my calculated freelance rate so much higher than my old salary ÷ 2080?
A salary comes with employer-paid payroll tax, benefits, paid time off, and a full pipeline of work. As a freelancer you cover both halves of Social Security and Medicare (15.3% self-employment tax), buy your own benefits, and only get paid for billable hours — typically 50–70% of your working time. Doubling your old hourly wage is a common rule of thumb for a reason.
Should I charge hourly or per project as a freelancer?
Per project usually earns more once you are fast at the work, because you keep the gains from your own efficiency. Use your calculated hourly rate internally: estimate the hours a project will take, multiply by your rate, then add a 10–25% buffer for revisions and scope creep.
How often should I raise my freelance rates?
Review at least once a year, and any time you are booked more than about 80% full for two months straight. Consistent overbooking is the market telling you that you are underpriced.