Freelance Hourly to Salary Calculator

Hourly Rate to Salary Converter

What is your "True" salary? $100/hr isn't the same as a $200k job.

Avg freelance week is often 20-30 billable.
Vacation + Sick days (Unpaid).
Software, insurance, accounting.
Subtracts the "Employer Portion" of FICA that you pay yourself.

How This Tool Works

The Freelance Hourly to Salary Converter bridges the gap between gross contractor rates and comparable W-2 employment. Most freelancers make the mistake of multiplying their hourly rate by 2,080 hours (40 hours x 52 weeks) and assuming that is their salary. In reality, a freelancer has significant overhead that a W-2 employee does not.

This calculator subtracts your unpaid time off, monthly business overhead, and the employer-side tax burden to give you a "purchasing power" equivalent. This allows you to compare a freelance gig to a corporate job offer accurately.

How to Use the Converter

  • Hourly Rate: Enter what you charge (or plan to charge) your clients.
  • Billable Hours: Enter only the hours you actually invoice. Be honest—most freelancers spend 20-30% of their time on unbillable admin/sales.
  • Weeks Off: Include vacation, public holidays, and potential sick days. Remember, if you don't work, you don't get paid.
  • Business Expenses: Include health insurance, software subscriptions, hardware depreciation, and office space.

Example Calculation

If you charge $100/hr and bill 30 hours/week for 48 weeks/year:

  • Gross Revenue: $144,000
  • Expenses ($500/mo): -$6,000
  • Self-Employment Tax Adjustment: -$11,016
  • Equivalent W-2 Salary: ~$126,984

In this scenario, a $127k job offer with benefits is financially superior to $100/hr freelancing.

Why This Tool Is Accurate

We use a multi-factor adjustment model to ensure the result isn't just a simple multiplication:

  • The FICA Overlap: W-2 employees only pay 7.65% in Social Security/Medicare. Freelancers pay the full 15.3%. We adjust for the "Employer Half" that you are forced to cover.
  • Expense Deduction: We treat business expenses as "lost salary" since they come out of your pocket before you can pay for personal life.
  • Real-World Billability: By separating "Total Hours" from "Billable Hours," we account for the administrative burden of running a solo business.

Frequently Asked Questions

Why is my freelance equivalent salary lower than my gross revenue?

Your equivalent salary is lower because it accounts for expenses an employer usually covers: the employer-side of Social Security/Medicare taxes (~7.65%), health insurance, equipment, software, and unpaid time off (PTO). $100/hr gross often feels like a $140k salary, not $200k.

How many billable hours should I expect per week?

Most full-time freelancers bill between 20 and 30 hours per week. The remaining 10-20 hours are usually spent on administration, marketing, sales calls, and professional development.

What are the biggest hidden costs of freelancing?

The largest hidden costs are Self-Employment tax, private health insurance premiums, retirement matching (which you lose from a W-2 job), and the 'bench time' between projects where you aren't earning.
Limitations & Disclaimer: This tool provides a financial comparison based on cash flow and tax burden. It does not account for the value of corporate stock options, 401k matching, or the "freedom premium" of being your own boss. Tax laws vary by region; consult a tax professional for specific advice.