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How to Set Freelance Hourly Rate

Freelancers often struggle to set competitive hourly rates. Harvest helps you determine a suitable rate by tracking billable hours and 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 Minimum Viable Rate

Determining your minimum viable rate is crucial for any freelancer. This is the lowest hourly rate you can charge while still covering all your expenses and achieving your financial goals. To calculate this, consider your total monthly expenses, desired savings, and the number of billable hours you can realistically work. For example, if your monthly expenses are $3,000 and you aim to save $500 monthly, and you can work 80 billable hours a month, your minimum viable rate would be $43.75 per hour ($3,500/80 hours).

Harvest can aid in this calculation by helping you track both billable and non-billable hours, ensuring you have an accurate understanding of how much work you can realistically bill for. With Harvest, you can also track expenses, providing a comprehensive overview of your financial obligations and enabling you to set a viable hourly rate that aligns with your business needs.

Analyzing Market Rates for Freelancers

Understanding market rates is essential to ensure your pricing is competitive. Globally, freelance rates vary significantly, with averages ranging from $21 to $101.50 per hour. In the U.S., the average rate hovers around $48 to $62.54 per hour, according to recent data. These figures can serve as a benchmark when setting your rates, ensuring you remain competitive within your industry.

It's important to consider how your experience, skills, and the specific demands of your niche impact your rate. For instance, younger freelancers aged 18-24 typically earn around $16 per hour, whereas those aged 45-54 can command up to $27 per hour. Harvest's detailed reporting tools can provide insights into how your current earnings compare to industry standards, allowing you to adjust your rates accordingly.

Adjusting Rates Based on Project and Client Type

Freelancers often need to adjust their rates based on project length and client type. Short-term projects may require higher rates due to the uncertainty and lack of long-term commitment, while long-term projects might justify a discounted rate. Additionally, different clients may have varying budget constraints, necessitating flexible pricing strategies.

Harvest offers the flexibility to set different rates for different projects and clients, helping freelancers optimize their pricing strategy. By customizing rates within Harvest, you can align your pricing with the project's scope and the client's profile, ensuring fair compensation while maintaining competitive pricing. This flexibility is crucial in maximizing both client satisfaction and your own profitability.

Incorporating Skills and Experience into Your Rate

Your skills and experience significantly influence your freelance rate. Advanced skills and extensive experience often justify higher rates, as they typically result in higher-quality work and greater efficiency. It's important to regularly assess your skill set and industry trends to ensure your rate reflects your true value.

Harvest can help track the hours spent on skill development and non-billable activities, ensuring these are factored into your rate calculations. This oversight ensures that your pricing accounts for the ongoing investment in your professional growth, aligning your rate with both your current capabilities and market expectations.

Set Your Freelance Hourly Rate with Harvest

See how Harvest helps freelancers track billable hours and expenses to set accurate hourly rates.

Screenshot of Harvest tracking tool for setting freelance hourly rates

How to Set Freelance Hourly Rate FAQs

  • When setting your freelance hourly rate, consider factors like your monthly expenses, desired savings, and the average market rates for your industry. Also, account for your skills, experience, and the specific demands of your niche. Harvest's tracking tools can provide insights into these factors, helping you set a competitive rate.

  • To calculate your minimum acceptable rate, add your monthly expenses to your desired savings and divide by your realistic billable hours per month. For instance, if your monthly expenses are $3,000 and you aim to save $500, with 80 billable hours, your rate would be $43.75/hour. Harvest can assist by accurately tracking your billable hours.

  • Freelance rates vary widely, with global averages ranging from $21 to $101.50 per hour. In the U.S., the average is around $48 to $62.54 per hour, depending on experience and industry. Harvest's reporting can help compare your rates to these industry benchmarks.

  • Adjust your rates for project length by charging more for short-term projects due to their uncertainty, while offering discounts for long-term engagements. Harvest allows you to set flexible rates per project, helping you maintain profitability while adapting to client needs.

  • Harvest allows you to track expenses in real-time, offering insights into your business costs. This helps ensure your hourly rate covers all expenses, providing a comprehensive view for accurate rate setting.

  • Skills and experience can significantly impact your rates, with advanced skills and extensive experience justifying higher charges. Harvest tracks non-billable activities like skill development, ensuring these are factored into your rate calculations.

  • Yes, Harvest integrates with numerous tools such as Asana, Trello, Jira, Slack, and more, enhancing your workflow efficiency and ensuring all tracked time and expenses are consolidated for better rate setting.