What is your worth as a freelancer — per hour?

You could be just taking the leap into freelancing or you are already there and surviving. Either way, it is always good to understand your own worth irrespective of the conservative friends or Orthodox parents advising you to do a 9 to 5.

If you are getting on the freelance bandwagon, you will need to understand the foundation on which your business and life will stand and the basis of that would be your billing rates. Let us look at an example to calculate a ball park figure if you are a freelancer based out of India.

Step 1: Billable hours

Assuming that you work 8 hour days and 40 hours a week, you will have a total of 40 X 52 billable hours in the year — 2080.


a. You could take a 2-week vacation which translates to 80 billable hours lost.

b. 10 public holidays a year will account for 80 billable hours lost.

c. 5 sick days will translate to 40 billable hours lost.

Net freelance billable hours in the year are 2080 — (80+80+40) = 1880.

Here, we cannot assume that you are going to bill clients for all of 1880 hours. As a freelancer, you will need to make calls, do some emails, learn new skills and spend some time on administration. So, let us assume that these tasks will take about 25% of the time.

You will be left with 1880 X 0.75 = 1410 billable hours.

Step 2: Income and Expenditure

Assume that your annual salary at present is Rs. 6,00,000.00

Let us add the annual costs of doing business to this:

a. Office Space /Co-working space — Rs. 60,000.00

b. Web Hosting and Domain — Rs. 5,000.00

c. Internet — Rs. 15,000.00

d. Invoicing/ Accounting SW — Rs. 10,000.00

e. Project Management Tools — Rs. 10,000.00

f. Telephone — Rs. 12,000.00

g. Laptop (50% — 2 year life) — Rs. 15,000.00

h. Marketing expenses — Rs. 20,000.00

TOTAL — — Rs. 1,47,000.00

Until now, your employer provided certain perks and probably took care of healthcare costs in addition to a few more. Normally this would account for about 10% of your salary and these have to be taken care of you from on. So it is an added expense. — Rs. 60,000.00

So, you new expenses as a freelancer — Rs. 2,07,000.00

Let us keep an allowance for uncollectible payment at 10% of target salary — Rs. 60,000.00

And, commissions to freelance platforms @ 15% — Rs. 90,000.00

You will be saving this if you take on work at Vulpith.

Therefore, total expenses are Rs. 3,57,000.00

Step 3: The final calculation

You will understand what you need to bill on an hourly basis by calculating as follows:

(Target Salary + New Expenses) / Net billable hours

= (6,00,000.00 + 3,57,000.00) / 1410

= Rs 678.72

You will need to bill an hourly rate of Rs 680.00 (approximately) to make your ends meet as a freelancer.


The above calculations are indicative only and related to India. Please make sure that you take into account your geographical region and cost of living before you calculate. You can use this template as a guide with your own expectations and figures depending on the country you live in and your service offerings.

Do make sure that you go through this exercise before you take the leap into freelancing so that you will understand what to expect and what not to.

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