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What Should I Charge Per Hour As a Freelancer

Harvest empowers freelancers to accurately determine their hourly rate, factoring in personal expenses and market rates, ensuring profitability and competitiveness.

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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 Worth and Financial Needs

Determining "what should I charge per hour as a freelancer" begins with understanding your unique value and financial requirements. Start by assessing your skills, experience, and niche expertise, as these factors significantly influence your earning potential. For instance, freelancers aged 55-64 typically earn $36/hour, while those aged 18-24 average $16/hour. This variance highlights the importance of experience in setting competitive rates.

Next, calculate your Minimum Acceptable Rate (MAR) by listing all monthly expenses, such as rent, utilities, and business costs like software and marketing. Set a realistic annual income goal and factor in taxes, which might require up to 30% of your income. For example, self-employment tax alone totals 15.3% on net earnings. Finally, estimate your annual billable hours, typically between 1,000 and 1,500, to determine your baseline hourly rate.

Exploring Market Rates and Pricing Strategies

Understanding market rates is crucial when setting your freelance hourly rate. In the United States, the average freelance rate is $48/hour, but this can vary significantly by industry. For example, cybersecurity developers earn between $40 and $90/hour, while writers can charge $30–$59/hour. Conduct thorough research based on industry trends, geographical location, and your experience level to benchmark your rates accurately.

When it comes to pricing strategies, consider the nature of your work and client needs. Hourly rates offer transparency for projects with uncertain scopes, while project-based rates suit defined deliverables and provide predictable income. Value-based pricing, which charges based on the outcome delivered, can be lucrative for experienced freelancers. A hybrid approach, combining different strategies, can offer flexibility and maximize earnings.

Navigating the Tax Landscape as a Freelancer

Taxes are a significant consideration in determining "what should I charge per hour as a freelancer." As a self-employed individual, you're responsible for both income and self-employment taxes, which cover Social Security and Medicare. The self-employment tax rate is 15.3% on net earnings, and you're required to file if your net income exceeds $400. Additionally, estimated tax payments are due quarterly, typically on April 15, June 15, September 15, and January 15.

Maximize your tax savings by deducting business expenses, which can lower your taxable income. Common deductions include office supplies, software, and marketing costs. Understanding these financial obligations is essential for setting a rate that not only covers your expenses but also meets your income goals.

Dynamic Pricing: Adjusting and Negotiating Your Rates

Regularly reviewing and adjusting your rates is vital for maintaining your freelance business's profitability. Consider factors such as inflation, increased demand, or new skills when deciding to raise your rates. For instance, freelancers in high-demand fields like banking and finance can command rates as high as $110.88/hour, reflecting the need to align pricing with industry standards.

Communicate rate increases to clients with clear justifications, such as market data or enhanced service value. Effective negotiation is key—use market research and demonstrated results to support your case. Avoid underpricing your services by recognizing and valuing your expertise, as this can lead to a "race to the bottom" and undervalue your work.

Set Your Hourly Rate with Harvest

See how Harvest helps freelancers calculate hourly rates based on expenses and market trends. Manage your pricing strategy effectively.

Screenshot of Harvest showing freelancer rate calculations.

What Should I Charge Per Hour As a Freelancer FAQs

  • To calculate your Minimum Acceptable Rate (MAR), list all monthly expenses, set a desired annual income, and factor in taxes. Divide the total annual financial need by estimated billable hours, typically between 1,000 and 1,500, to find your base rate.

  • Average rates vary by industry. For example, programmers in the US earn $60-$70/hour, while marketing consultants charge $65-$150/hour. Writers typically charge $30-$59/hour. It's important to research rates specific to your field and experience.

  • Consider your skill level, niche expertise, industry demand, and geographical location. Also factor in your expenses, desired income, tax obligations, and non-billable hours to ensure a comprehensive rate calculation.

  • Harvest provides tools to track time and manage projects, supporting both hourly and project-based billing. This flexibility helps freelancers choose the best pricing strategy, understand project scopes, and manage client expectations effectively.

  • Hourly rates are ideal for projects with uncertain scopes and provide transparency. Project-based fees suit defined deliverables, rewarding efficiency. Consider your project types and client needs when choosing a pricing model.

  • Freelancers must account for income and self-employment taxes, totaling 15.3% on net earnings. These taxes impact your minimum rate calculation, ensuring you cover all financial obligations while meeting income goals.

  • Use market research and demonstrated value to support your rate during negotiations. Be clear about the quality and outcomes of your work, and communicate any rate changes with justifications to maintain strong client relationships.