Question 1

How do I calculate my freelance hourly rate?

Accepted Answer

Start with the annual salary you want to earn. Add your business expenses (software, insurance, gear, taxes). Divide the total by the number of billable hours per year (typically half of total working hours after admin, marketing, and unpaid time). The result is the minimum hourly rate you must charge to sustain your business.

Question 2

What is a billable hour?

Accepted Answer

A billable hour is any hour you can charge a client for. Most freelancers can only bill 50-65% of their total working hours because the rest goes to admin, marketing, accounting, learning and time off. A common default is 1,000-1,200 billable hours per year for a 40-hour work week.

Question 3

What is a reasonable freelance markup?

Accepted Answer

A 20-30% profit margin above costs is typical. This gives you a buffer for slow months, sick days, training, and business growth. Anything below 10% margin puts you at risk during lean periods.

Question 4

Should I charge the same rate to all clients?

Accepted Answer

No. Most freelancers have a minimum rate, a standard rate, and a premium rate. Premium clients (agencies, large companies, urgent work) often pay 1.5-2x your standard rate, while smaller clients or retainer work may stay closer to the minimum.

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