Freelance rates: how to price yourself without underselling
Your old salary divided by 2,000 hours is not a freelance rate. The maths that keeps independents solvent, explained simply.
By Daniel Brooks · 2026-07-27
New freelancers price like employees and quietly go broke. A sustainable rate covers the salary, the benefits you lost, the unbillable hours and the dry months.
The honest formula
- Start with target income — what you'd earn employed, plus ~25–30% for benefits and self-employment taxes.
- Divide by billable hours — realistically 50–60% of your time; the rest is sales, admin and gaps.
- Add margin — software, insurance, equipment, slow seasons.
That's usually 1.5–2× the 'equivalent' hourly salary — and it's why experienced freelancers seem expensive. They're solvent.
Rate anxietyIf nobody ever pushes back on your price, you're underpriced. Raise rates with each new client until someone flinches.