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Hourly Rate Calculator for Entrepreneurs

Entrepreneurs often struggle with setting the right hourly rate due to fluctuating expenses and income goals. Harvest offers a solution to accurately calculate and adjust hourly rates, factoring in non-billable hours and business expenses.

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What should you charge per hour?

Most freelancers and consultants dramatically undercharge. This calculator accounts for what most people miss: non-billable time, taxes, and overhead.

$
Accounting for vacation, holidays, sick days
60%
Most freelancers can bill 50-70% of their time. The rest goes to admin, marketing, proposals, and learning.
$
Software, insurance, equipment, accounting, taxes beyond income tax, etc.
Your break-even rate $0
Recommended rate (+20% buffer) $0
Billable hours per week 0h
Equivalent daily rate $0

Start tracking your billable hours

Walk through the entire flow below. Start a timer, check your reports, and create a real invoice — all in three clicks.

Go ahead — start tracking!

One click and you're timing. Try it right here: start a timer, add an entry, edit the details. This is exactly how it feels in Harvest.

  • One-click timer from browser, desktop & mobile
  • Works inside Jira, Asana, Trello, GitHub & 50+ tools
  • Duration or start/end — your call
  • Day, week & calendar views to stay on top of it all
  • Friendly reminders so no hour gets left behind
Acme Corp
Website Redesign
Homepage layout revisions
1:24:09
Content Strategy
Blog calendar planning
1:30:00
SEO Audit
Technical audit report
0:45:00
Brand Guidelines
Color system documentation
2:15:00
Logo Concepts
Initial sketches round 1
1:00:00
Today's total 6:54:09

Understanding Your Hourly Rate as an Entrepreneur

Determining the right hourly rate is crucial for entrepreneurs striving to balance profitability with competitive pricing. The process involves several important factors, such as business expenses, income goals, and tax obligations. In the U.S., self-employment taxes alone can amount to 15.3% of net income, making it essential to account for these in your calculations. Harvest simplifies this process by providing tools to track both billable and non-billable hours, ensuring that entrepreneurs can accurately calculate their effective hourly rate. This feature is critical, as non-billable hours can significantly impact overall profitability if not properly incorporated.

Calculating Your Hourly Rate: Key Inputs and Considerations

To accurately determine your hourly rate, you need to consider several key inputs: your desired annual income, the number of billable hours you can realistically work, and your total business expenses. It's recommended to account for 15-20% of your income to cover taxes and unforeseen expenses. Additionally, setting aside time for non-billable activities such as marketing, administrative work, and client meetings is essential. With Harvest, you can track these non-billable hours, allowing you to adjust your rates accordingly and ensure all aspects of your work are compensated.

Avoiding Common Mistakes in Hourly Rate Calculation

Many entrepreneurs make the mistake of underestimating their expenses or overestimating billable hours, leading to financial shortfalls. It's crucial to base your calculations on realistic estimates and regularly review them as your business evolves. For example, failing to include time spent on project management or client communication can lead to a 15-20% loss in billable income. Harvest provides detailed reporting capabilities that help identify areas where time is spent, offering insights to refine your rate calculations and avoid costly errors.

Adjusting Your Rates for Different Clients and Projects

As an entrepreneur, flexibility in pricing is key to accommodating varying client needs and project complexities. Different projects may require different levels of effort, and client budgets can vary significantly. Harvest's flexible rate tracking allows you to adjust rates based on client type and project requirements. This adaptability not only helps in maximizing profitability but also ensures competitive pricing tailored to each client's unique needs. Regularly reviewing these adjustments can lead to a more sustainable pricing strategy.

Hourly Rate Calculator for Entrepreneurs by Harvest

Explore how Harvest helps entrepreneurs calculate accurate hourly rates by tracking billable and non-billable hours and adjusting for expenses.

Harvest hourly rate calculator for entrepreneurs interface

Hourly Rate Calculator for Entrepreneurs FAQs

  • To calculate your hourly rate, consider your desired annual income, total business expenses, and the number of billable hours you can realistically work. Include time for non-billable activities, which Harvest helps track, to ensure all aspects of your work are considered in your rate.

  • An hourly rate calculator requires inputs such as desired annual income, expected billable hours, total business expenses, and tax obligations. Harvest allows you to track non-billable hours, which should also be factored in to avoid underpricing your services.

  • Include all fixed and variable business expenses in your calculations. This ensures that your hourly rate covers operational costs and contributes to your profit margins. Harvest's detailed expense tracking can aid in accurately determining these costs.

  • Non-billable hours, such as time spent on marketing, administrative tasks, and client meetings, are essential to include in your rate to ensure you are compensated for all aspects of your business. Harvest helps track these hours, providing a comprehensive view of your workload.

  • Common mistakes include underestimating expenses, overestimating billable hours, and neglecting non-billable activities. These can lead to financial shortfalls. Harvest's reporting tools help identify where time is spent, assisting in refining your rate calculations.

  • Harvest offers flexible rate tracking, allowing entrepreneurs to adjust rates based on client type and project complexity. This flexibility ensures competitive pricing and maximizes profitability by accommodating varying client needs.

  • It's commonly recommended to set aside 15-20% of your income for taxes, considering both self-employment and federal/state income tax obligations. Harvest's detailed tracking can help ensure you're prepared for these expenses.