How To Calculate Your Freelance Hourly Rate as a Beginner

freelance rate calculatorPeople say that time is money, but have you ever thought about how valuable your time actually is? If you’re just getting started in the world of freelancing – welcome. Now it’s time to sit down and figure out what your hourly rate is! Luckily for you, you came to the right place.

In this article, I’m going to tell you the secret of how to calculate my freelance rate.

Using a Freelance Rate Calculator

Before diving deeper into the question, I want to provide a quick answer. What I personally use is a freelance rate calculator. This quickly does all the math for you after you plug in a few numbers. If you want the fastest approach when you’re asking yourself the question, “How do I calculate my freelancer hourly rate?”, then definitely use a calculator.

To understand each of the steps, keep reading.

Why Does Your Hourly Rate Matter?

There are a lot of reasons why you should care about your hourly rate as a freelancer. Let me tell you some of the big reasons.

Compare it to the Job Market

When you’re looking at a job offer, one of the biggest things you should care about is the salary. In the case of freelancing, you’re not going to have a salary. Places like Fiverr will pay you per project.

If you want to compare apples to apples, then you’ll need to know your hourly rate. It’s a good gauge to tell you how you’re doing.

Make Sure You Can Pay Your Bills

Secondly, it lets you do the math to make sure you can pay your bills each month. If you make a certain amount an hour, you know how many hours you need to work in a month to get your bills paid.

This should arguably be the biggest reason why your rate matters.

Helps You Track Your Improvement

You’re just starting out, so your rate might be lower than you want it to be. For most people, the more years they work in the industry, the higher their hourly pay gets.

By understanding your hourly pay, you get to track your improvement from year to year. It helps you physically see the reward of hard work.

See Related: Time Tracking Apps for Freelancers

how to calculate my freelance rate

Allows You to Price Yourself to a Client

Finally, knowing your rate per hour allows you to give a prospective client a firm price. You know that historically people pay a certain amount of money for your services. That’s a good starting point when you are negotiating a rate with a potential client.

If you want to work for exclusive freelancing sites like Toptal, then you need to be able to price yourself accordingly.

You can bid on a project with confidence because you have done the math and you know your true rate. It’s the equivalent of going to a job interview and telling them your required salary.

Calculating a Salary from an Hourly Rate

Speaking of salaries, did you know that you can convert from salaries to hourly rates and vice versa? It’s a really simple math equation. I used to work in the world of salaries, so now that I’m a freelancer I like to do the math in my head to get a general understanding of where I am.

Let’s say that you’re making $10 an hour as a freelancer. Not too shabby. Well, the typical working year in corporate America is 2,080 hours. That means that if you want to convert your hourly rate to a salary, then you’re going to multiply $10 x 2,080. That gives you $20,800 a year.

The same is also true if you want to go the other way.

See Related: Freelance vs Self-Employed

Targeting a Salary

This leads me to my next point. If I want to know how to calculate my freelance rate with a targeted salary in mind, I’ll use the math from above.

A lot of freelancers who first make the jump to freelancing have a certain amount of money they need to make each year to make ends meet. Let’s say I made $50,000 in my office job that I just left to be a freelancer. If I want to replace my income, I’ll divide $50,000 / 2,080. That gives me my targeted hourly rate.

In this case, it’s $24.04 an hour.

The Steps of to Calculate Freelance Hourly Rate

So now I get to talk about the fun stuff. I’m going to explain the five steps that are used to calculate freelance hourly rate. If you took a look at the freelance rate calculator I mentioned earlier, you already have a head start here.

Buckle up because there’s going to be a decent amount of information here. My hope is that you can do it yourself after you read my notes.

See Related: Tax Software for Freelancers & Self-Employed

Step 1: Target an Annual Salary

This was briefly explained a second ago, but this is the most important step. You want to target a realistic salary that will keep you financially stable.

Keep in mind that the first year of freelancing might not be as lucrative as you want. That shouldn’t discourage you! Just remember it as you’re putting together a target salary.

For this example, I want to make $85,000 a year. Imagine that I’m leaving an office job making $70,000, and I want to brag about my new career in freelancing to my old coworkers!

Calculate Freelance Hourly Rate

Step 2: Calculate Expenses and Overhead

Now it’s time for some math. Since you’re self-employed, there are some extra expenses that you’ll have to consider.

One of the most important steps in how to calculate my freelance rate is understanding my expenses in detail.

There are a lot of different factors that will determine the amount in this section, but here are some general categories that might pertain to you along with arbitrary yearly costs. These figures are loosely based on numbers I calculated for myself in the past.

Office Space – $5,000

Do you have a special area that you do your freelancing in? Some people can claim part of their home as their office space and use that as a write-off later.

Maybe you signed up for a co-working space that you share with others. Pay attention to how much this costs you.

Web Hosting – $400

If you have a site, then you’re familiar with web hosting fees. If you’re making a site, you can expect to pay a few hundred here.

This is an area where it pays to spend a little. A strong, well-designed website will attract people to you.

Software – $800

You might be using accounting, project management, and/or industry-specific software for your operation. Keep a tally of how much the software subscriptions add up to a year.

Internet – $1,000

Your online freelancing operation is nothing without your internet package. You can include some or all of the price if you use a home office for freelancing.

Work Devices – $2,000

Computers, phones, tablets, laptops, and other devices you use for work should also be accounted for.

Marketing – $1,500

Sometimes you have to spend a little to make a little. Marketing campaigns like ads, flyers, and promotions will go in this category.

Uncollected Payments (Roughly 2% Of Revenue) – $1,700

Whenever payments are required, there are clients that try to weasel out of paying. To be conservative, assume that 2% of your revenue will go uncollected or unpaid.

Tax Prep – $1,000

Now, consider the costs associated with bringing in a professional tax advisor. Since your income will be more complex this year, you’ll probably need to opt for quarterly filing. Tax pros might charge freelancers more than a typically W9 employee because there are more moving parts and more paperwork to do.

Self-Employment Tax – $6,500

Your self-employment tax is going to vary on a lot of different factors. In this example, I’m paying around 8% of my income in self-employment tax.

Medical Insurance – $6,000

You might expect to pay around $500 a month for medical insurance on your own. Again, this number will vary a lot depending on your specific situation.

Final Count

Adding together all of the expenses and overhead will get you a final number. For this example, I expect to spend $25,900 a year!

This might seem like a lot of money. Now is a good time to look through the budget and see if there is anything that can be cut down or removed to reasonably reduce my expenses. Maybe I find a less expensive office and I opt for older devices.

See Related: Freelance Jobs for Beginners

Calculate Annual Salary

Step 3: Calculate the New Adjusted Annual Salary

With your final expense handy, it’s time to calculate your “new adjusted annual salary”. This adjustment takes your desired salary and factors in the associated expenses from step 2.

In my example, my $85,000 desired salary will be added to my $25,900 in expenses.

This leaves me with a value of $100,900. This figure is my adjusted annual salary. In other words, this is the amount of money I will actually have to make if I want to take home $85,000.

See Related: Fiverr vs Freelancer

Step 4: Figure Out Your Annual Billable Hours

Now we’ll revisit the idea discussed earlier about billable hours. As a reminder, billable hours are how many hours you physically work. If you feel lost at this point, you can check out FreelancerNomads to get more clarification.

If you have a 9-5 office job, your billable hours are considered 8 hours a day, 5 days a week, 52 weeks a year. If you multiply those three numbers together, you get 2,080 hours a year.

As a freelancer, you have more freedom. That might be the reason you got into freelancing in the first place! You get to decide how much or how little you work in a given year.

The only difference here is you don’t get paid vacation or paid days off. If you want to take a few weeks off, you’ll have to factor for it here.

So let me show you how I decide my annual billable hours.

I want to work 5 days a week for 8 hours a day. But, I want to take 10 weeks off each year. This accounts for holidays, sick days, vacations, and lazy days. 10 weeks amount to 400 hours of work that I won’t do a year.

I’ll take the original 2,080 figure and subtract 400 hours. I’m left with a 1,680 hour work year.

Billable Hour Caveat

There is a slight caveat to keep in mind. In freelancing, your billable hours are when you’re physically working. This doesn’t include the time you spend eating lunch, doing paperwork, communicating with clients, searching for work.

Your true billable hours are how long you spend working on projects for clients.

I like to suggest giving yourself some wiggle room and allocating 33% of the time you spend in a day on non-work activities.

That leaves you with 66% of those annual hours as true billable hours.

In my case, I’ll multiply 1,680 hours by 66% and get 1,109 actual billable hours a year.

Step 5: Divide Your Adjusted Salary by Your Billable Hours

So now I have all of my important numbers. It’s time for my final calculation. This will calculate freelance hourly rate for my example.

If you’re following along, you’ll take your adjusted annual salary and divide it by your actual billable hours a year.

In my case, I’ll take $100,900 and divide it by 1,109. This leaves me with $90.98.

That means that my freelance hourly rate has to be $90.98/hour if I want to hit my targeted salary with my expenses. You can take this figure to a freelancing platform like Solidgigs and start finding work to help you hit this number.

If you want to change this number, then you can tweak your target salary or your expenses each year.


I know this is a lot of information, so let me be proactive and answer some of the questions you might have. These are questions I get a lot, so I hope it helps!

What if I Don’t Know My Expenses?

Luckily, this form isn’t set in stone. As you get a better handle on the value of your expenses, you can edit the calculator and get a better number. For now, just estimate.

Where Do I Start with a Target Salary?

Start with a number that is reasonable. For reference, a minimum-wage employee can expect to make $15,080 a year. The target salary can be changed as you do the math.

I Don’t Have a Marketing or Software Budget, Does This Still Work?

Yes, this process is a one-size-fits-all model. If you don’t have certain expenses that were detailed earlier, then just ignore them. Alternatively, if you have freelance-related expenses that weren’t stated in step 2, you’ll need to add them.

My Rate Seems High, What’s Wrong?

There are a few places that will make your rate seem high. Either you did the math wrong, your expenses are high, or your starting salary is high. Check the math and tweak these two numbers to see if the rate is more reasonable.

I’d also suggest against this mentality. If a client is willing to pay your rate, it’s not too high. You won’t know until you try. There are a lot of sites where clients are willing to pay you more money than you might expect.

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Freelance Photography 101: How to Make Your Side Hustle Full-Time

Freelance PhotographyThe world of freelancing has been getting bigger and bigger. If you have skills behind a camera and you’re ready to go full-time, then you came to the right place. I’m going to tell you what it takes to make your side hustle into your full-time gig. You’ll learn every step that goes into how to become a freelance photographer so you can leave your employer behind and become your own boss!

How to Become a Freelance Photographer

The first step in making photography your full-time gig is to get started. If you have photography skills and equipment, you just need to be connected with the right people. For beginners, there are plenty of ways to start making real money.

If you already have skills in photography, you’re off to a good start. I always tell people to reach out to your friends and family. Ask them if they have a need for a freelance photographer.

Not only does it give you a better idea how to become a freelance photographer, but it gives you a low-stress environment to learn how to work directly with a client rather than starting in  a place like Solidgigs.

Finding friends for your initial projects will also result in some great feedback and testimonials to help your business. Remember, when you’re a freelancer you need to approach your work like it’s your business.

The same is true if you’re looking into how to become a freelance photojournalist. This is a little trickier unless you know the right people.

See Related: Easy Ways to Sell Your Skills Online

How to Become a Freelancer Online

If you want to quickly grow your portfolio and learn the ropes, then you can try an online platform.

The best way to learn how to become a freelance photographer is to join a platform like Flexjobs or Fiverr. They are platforms that automatically connect you with clients who are willing to pay for your work.

If you have more experience, then you can apply for Solidgigs. They have higher-level clients that are looking for photographers that can do more.

There’s another site called Toptal that exclusively hires the top performers in different categories. If you have a very strong portfolio, you can try this site.

Don’t wonder anymore about how to become a freelancer online, it’s really as easy as signing up and getting started. There will be a learning curve in the beginning, but that’s to be expected with this line of work.

You’ll be a natural in no time. The advantage of online work is you can get connected with tons of people who are looking for your specific expertise.

See Related: Freelance Business Ideas for Self-Employment

The Tips and Tricks to Full-Time Freelance Photography

Full-time Freelance Photography

I’d like to take some time and explain in detail how to become a freelance photographer when you’re currently working a 9-5 office job. These are some tips and tricks that I’ve come up with over the years, and I hope they help you! Keep in mind, these tips are in no particular order.

#1: Decide What Type of Photography

Think about how many different types of photography there are. Art, weddings, photojournalism, real estate, marketing, landscapes, promotional – the list goes on. So now it’s time to decide what type of photography you want to offer.

If you use a site like Fiverr, you can experiment with different types of photography and find out which is right for you through trial and error.

Maybe you already have a portfolio of some projects of a certain type. This will help you get work in this type of photography, but it can also be used to pivot to another category if you want.

Also, keep in mind that learning how to become a freelance photojournalist follows a different path than a standard photographer. You’ll be reaching out to more specific clients, and you’ll also need the journalistic knowledge.

#2: Don’t Forget to Take Time Off

There is a common ploy that a lot of freelancers fall into. We work as hard as we can for as long as we can without any breaks. The result? We burn out.

I always suggest that you remember to take time off. After a big project, I always like to take a week or so and gather myself. Between projects, I might take a day or two.

Taking time off will net you more money each year because you won’t burn out and give up.

#3: Get Good Equipment

In the world of photography, you can only be as good as your equipment. Make sure you have the right camera, lighting, lenses, and bodies. There’s a lot that goes into taking freelance photography (which you probably know by now).

#4: Make a Great Website

If you don’t have a great website, you need to make one. It’s a way to show potential customers how great you are, and it also attracts new customers organically.

A good website will highlight your skills, tell your story, and tell potential customers how they can work with you. Don’t be afraid to spend a little on a designer and website builder to get this right.

#5: Make it Legal

Each city and state have certain requirements when it comes to operating a freelance photography business legally. You want to make sure you check all the boxes, so you don’t run into legal problems later.

This might also be a good time to get some insurance out on your business and equipment.

See Related: How to Register as a Freelancer?

#6: Approach it Like A Business

This is the most meaningful advice I can give people on how to become a freelance photojournalist or photographer. Running a successful profile on Flexjobs is just like running a successful business. When you’re a freelancer, you’re running a business.

Everyone you work with is a client and therefore your boss, everything you get paid for is a project, and your name is a company name. You need to make sure you understand that this isn’t a hobby anymore and treat the work accordingly.

If you take the work seriously, you’ll get more serious work.

Freelance Photographer

#7: Make a Routine

Just like a day in the office, you need to put together a routine that works for you. Over time, clients are going to learn when they can contact you, when you might reach out to them, and when to expect their photos.

Since you’re going to be treating photography like a business, you might as well put together some business hours.

In those hours, you have to decide how much time you can dedicate to different tasks. I have a set routine that I’ve been following for a long time now. Now, my body and brain are used to it and the days flow by smoother.

It creates more predictability and professionalism on your part.

#8: Work Smart

Just because something is hard and takes a while to do it manually doesn’t mean you have to. There are a million different programs that are designed specifically to expedite different things. People who made in the world of freelancing give thanks to the different apps and software they used.

My tip is to work smarter, not harder. If there’s a program you can use that automatically logs your time, creates invoices, and keeps track of your project – use it! Understand how much money it can save you and compare that to how much it costs.

If it works out to less than your billable hourly rate, then go for it. The more autonomous your workflow is, the more money you can make and the more clients you can handle.

This is one of the things that you’ll perfect along the way. You might start out doing everything by hand, but eventually, you’ll understand where programs fit into your business.

#9: Build Your Portfolio

I cannot stress this enough – build your portfolio! Any time you take a professional picture, throw it on the portfolio. Add tags so someone viewing can sort your work by specifics. For example, put all of your landscape photos in the same part of your site, and your wedding photos in a different part.

Your portfolio should be easy to access for prospective clients. A lot of people like to put their portfolio on their website which also leads to more views on their site.

Also, it’s worth mentioning that your portfolio doesn’t have to be filled with photos you took strictly for clients. You can take your own pictures for the sole purpose of putting them on your portfolio.

Make sure all of the photos are professional and look incredible. This is the best way to promote your photography skills.

See Related: How to Get Freelance Clients?

#10: Edit Before Delivering Photos

Every photo that you deliver to a client, send out, or put on your portfolio should be fully edited. You already know how important the editing process is, so you might as well show it off here.

People are used to the edited pictures they see online all the time, so they might be underwhelmed when you give them raw photos. Of course, if your client specifically asks for raw photos then you can provide them as well. Even when clients request unedited photos, I like to give them the edited versions as well so they can see the difference moving forward.

This is a good time to point out how important your editing skills are. The best photographer in the world who has no editing skills might lose out to a mediocre photographer with the best editing skills. Keep that in mind as you’re building your freelancing business.

Understand that your clients aren’t going to be professional photographers so they might not appreciate the photography tricks you used to take a great, unedited photo.

Learning Freelance Photography

#11: Keep Learning

You can never learn too much. I spend a lot of time each year going to workshops, reading articles online, and doing research. There are a lot of online courses that will help you tremendously.

You’ve seen how quickly the world of photography has advanced. If you go years without learning anything new about photography, who’s to say how much you missed out on?

Learning and further education should be one of the most important things on your list as a freelance photographer.

Keeping up with the newest techniques and styling is a surefire way to improve your performance.

#12: Get Feedback, Testimonials, and Reviews

Everybody likes to work with a proven professional. That’s why we check reviews before going to a restaurant or buying an item online. We like to hear what other people have to say so we’re not going in blind.

Sure, your portfolio and website will give the viewer a good idea of your skill level.

Keep in mind, skill is just one part of picking out a photographer. They also want someone who’s easy to work with, punctual, professional, and always tries their best.

You can try to convince them that you have these qualities, but nothing’s more convincing than legitimate testimonials and reviews from past clients.

In the beginning especially, every time you close a project you should ask for feedback, a testimonial, and a review.

It helps you understand how you performed. It also gives you insight into what you excel at and what you need to work on.

#13: Connect with Other Photographers

Talking to people in the industry is a cool way to learn about different things you didn’t know about. Especially when you first start as a freelancer, your best friends should be fellow freelancers. They’ll know where to start, what to do, and some other personalized tips on how they found success.

If they ever get approached for projects that they don’t have the expertise or time to complete, ask them to forward the client to you. Make sure you return the favor by doing the same for them.

#14: Take Time to Reflect

Every so often you should pause for a moment and reflect on your progress. Think about where you were a month, a year, or five years ago in your career. You might even take a look at some photography that you took back then and conversations with past clients.

This will give you a good gauge of how far you’ve come. This is a good way to avoid burning out because it shows you exactly what the outcome is of hard work and determination.

This is proof that you successfully found out how to become a freelancer online. This might be a good time to celebrate your triumphs, too.

#15: Don’t Forget to Brag to Friends

Finally, don’t forget to brag about the success that you’ve found! Obviously, try not to do this with clients because it will paint you in a negative light.

Reach out to close friends and family and give them an update on a big project you got, great feedback from a client you received, or a new skill that you learned in the industry.

Show off your portfolio to your friends and let them share your excitement!

It’s really fun to be a freelancer. Friends and family members that aren’t freelancers won’t get it and they’ll be so excited that you’re letting them behind the curtain a little bit.

Also, it helps you realize the good things going on in your career.

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