Hourly Rate Calculator
Work out what to charge per hour — for freelance work, consulting, coaching, design, or any service — based on the income you actually want, not just a guess. Accounts for the non-billable time every service provider has but rarely budgets for.
What you need to earn
Your working time
| Billable hrs/week | Billable hrs/year | Required rate |
|---|
How to calculate your hourly rate
Hourly rate = (Desired income + Expenses) × (1 + Buffer %) ÷ Billable hours
Most people set their rate by picking a number that “feels right” or matching a competitor, then discover months later they’re not actually earning what they need. Working backward from your income goal and your real billable hours — not your total working hours — gets you a number grounded in what you actually need to earn, for any kind of service work: freelance, consulting, coaching, design, development, or done-for-you services.
You want to take home $80,000, with $6,000 in business expenses. You work 40 hours/week, 46 weeks/year, but only 65% of that time is actually billable (the rest is admin, proposals, and marketing) — that’s 1,196 billable hours/year. Adding a 10% buffer: ($80,000 + $6,000) × 1.10 ÷ 1,196 ≈ $79/hour.
The number almost everyone gets wrong: billable percentage
If you work 40 hours a week, you are not billable for 40 hours a week — not even close, for most service providers. Time spent on proposals, invoicing, client emails, marketing, admin, and your own business development doesn’t generate revenue directly, but it still has to be paid for by the hours that do. A billable percentage of 60-75% is common for established freelancers and consultants; new service providers still building a client base often run lower, sometimes 40-50%, while they spend more time on business development. Guessing your billable percentage too high is the single most common reason a calculated “reasonable” hourly rate still doesn’t add up to a livable income at the end of the year.
Hourly vs. project-based pricing
An hourly rate is a useful starting point even if you ultimately price by project or package, because it lets you sanity-check any flat fee — divide the proposed project fee by your realistic time estimate and confirm it clears your target hourly rate. Many experienced service providers move toward value-based or project pricing over time (charging based on the outcome delivered, not hours worked), but almost everyone benefits from knowing their hourly floor as the number a project fee should never fall below.
Frequently asked questions
The Coaching Price Calculator helps package this into a per-session or program price.
Jeff Cobb, Founder of Learning Revolution
Jeff Cobb is an expert in online education and the business of adult lifelong learning. Over the past 20+ years he has built a thriving career based on that expertise – as an entrepreneur, a consultant, an author, and a speaker. Learning Revolution is a place where Jeff curates tips, insights, and resources to help you build a thriving expertise-based business. Learn more about Jeff Cobb here.