How do I convert my salary to a freelance rate?

Short answer

Divide your target salary by about 1,000 billable hours a year, then add 25–35% for self-employment tax, benefits, and unpaid time. A $100,000 salary converts to roughly $125–$150 an hour freelance, not the $48 an hour a straight 2,080-hour division suggests.

Salary to freelance hourly rate (1,000 billable hours)

Target salary	Naive /2080	Realistic freelance rate
$60,000	$29	$75–$90
$80,000	$38	$100–$120
$100,000	$48	$125–$150
$150,000	$72	$190–$225
$200,000	$96	$250–$300

How to read this table

$200,000 sits at the top of the table ($96) — $250–$300. If your situation looks like this row, plan against the upper half of the range rather than the midpoint.
$60,000 anchors the bottom ($29) — $75–$90. Treat this as the conservative case you should still be profitable at.
The gap between the top and bottom row is roughly 3.3×. That spread is why a single blended average is close to useless here — pick the row that matches your setup instead of averaging the column.
With 5 reference points in the "salary to freelance hourly rate (1,000 billable hours)" table, the fastest way to use this page is to find the closest row, take its naive /2080, then stress-test it ±30% before you build a plan on it.

Context

Freelancers rarely bill more than 55–65% of their working hours; the rest goes to sales, admin, and gaps between contracts. Employers also cover payroll tax, health coverage, equipment, and paid leave — costs that shift entirely onto you. Pricing off the naive hourly figure is the single most common reason freelancers earn less than they did employed.

What moves this number

Billable ratio

Freelancers bill roughly 60–70% of working hours once sales, admin, and delivery overhead is counted. Rates set on 100% utilisation always underprice.

Self-employment costs

Taxes, insurance, software, and unpaid time off add 25–40% on top of the salary you are trying to replicate.

Positioning

Specialists in a named vertical price 1.5–3× generalists doing the same technical work.

Pricing model

Hourly, day rate, project fee, and retainer produce different effective rates for identical work — project and retainer usually win.

Methodology

Assumes 1,000 billable hours per year and a 25–35% uplift for self-employment tax, benefits, equipment, and unpaid business time. Adjust billable hours down for heavier sales cycles.

Assumptions and caveats

Rates are pre-tax and exclude self-employment costs unless a row says otherwise.
Regional cost of living shifts these ranges substantially.
This page was last reviewed on 2026-08-12. Ranges are updated as new data lands, so re-check before using them in a contract or a plan.
Use these numbers as a starting range, not a guarantee — your own historical data always beats a benchmark.

Frequently asked questions