Calculate the gross revenue you need to earn as a freelancer to hit your desired take-home pay after taxes and expenses.
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Most freelancers set their income goal by asking 'how much can I charge?' — working from supply to demand. The more powerful approach is to start with your desired outcome and work backward: what lifestyle do I want, and what gross revenue do I need to generate to fund it?
Start with your annual take-home goal — the after-tax, after-savings income you want to live on. Add your annual savings target (retirement contributions, emergency fund building, investment goals). Add your estimated annual business expenses. This sum is your net financial requirement.
Now gross it up for taxes. Divide the net requirement by (1 minus your effective tax rate). If you need $80,000 net and your effective rate is 30%, you need $80,000 / 0.70 = $114,286 in gross revenue.
Finally, connect this to your hourly rate: divide your gross revenue target by your realistic annual billable hours. If you can bill 1,500 hours per year and need $114,286, your minimum rate is $76/hr. Anything below this and you're not funding your complete financial picture.
This backward calculation is more motivating than arbitrary rate-setting because it directly connects every hour you bill to a real life goal.
Hourly Rate
The amount a freelancer charges per hour of work, calculated to cover expenses, taxes, and desired income.
Take-Home Pay
The net income a freelancer keeps after paying all taxes, business expenses, health insurance, and other deductions from gross revenue.
Net Income
A freelancer's total earnings after deducting all business expenses and taxes — the actual profit the business generates.
Add your desired take-home pay plus savings goal plus business expenses to get net needed, then gross it up by dividing by (1 - your effective tax rate). For example: $60k take-home + $10k savings + $10k expenses = $80k net. At 30% tax: $80k / 0.7 = ~$114k gross revenue needed.
28-35% of gross income is typical for US freelancers in the $60k-120k income range, including SE tax. Higher earners (above $150k) typically see effective rates of 35-40%. Significant business deductions can bring the rate lower.
Once you know your gross revenue target, divide by your realistic annual billable hours to get your minimum hourly rate. If you need $114,000 and can bill 1,500 hours/year, your minimum rate is $76/hr.
Yes — savings are a financial obligation to your future self, not optional discretionary spending. By including your savings goal in the calculation, you ensure your income target actually funds your complete financial life, not just current spending.
Hourly Rate Calculator
Calculate your optimal freelance hourly rate based on your income goal, billable hours, overhead costs, and desired profit margin.
Billable Hours Calculator
Calculate how many billable hours per week you need to hit your income target after accounting for vacation, sick days, and admin time.
Savings Rate Calculator
Calculate your current savings rate on irregular freelance income and see how much to set aside each month.