Question 1

How do I calculate my hourly rate from salary?

Accepted Answer

Divide your annual salary by the number of working hours per year. Standard is 2,080 hours (40 hours x 52 weeks). For example, $60,000 / 2,080 = $28.85/hour.

Question 2

What hourly rate should freelancers charge?

Accepted Answer

A common rule of thumb: take your desired annual salary, add 25-50% for self-employment taxes, benefits, and overhead, then divide by billable hours (typically 1,000-1,500 per year, not 2,080).

Question 3

Why do freelancers charge more than employees?

Accepted Answer

Freelancers cover their own taxes, health insurance, retirement, equipment, software, unpaid vacation, and non-billable hours (admin, marketing, invoicing). The effective rate must account for all of these.

Question 4

How many billable hours per year is realistic?

Accepted Answer

Full-time freelancers typically bill 1,000-1,500 hours per year. The rest goes to marketing, admin, vacation, and downtime. Using 2,080 hours would underestimate the rate you need to charge.

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