Why salary ÷ 2,000 is the wrong formula
An employee earning €60,000 works roughly 2,000 hours a year — so €30/hour looks like the "equivalent" freelance rate. It isn't, for four reasons. First, freelancers pay their own business costs (software, insurance, accounting, equipment). Second, they have no paid holidays or sick leave — every week off is unpaid. Third, a large share of working time is non-billable: pitching, invoicing, admin, learning. Fourth, employees get benefits — employer pension contributions, social-security contributions — that freelancers must fund themselves. Ignore these and the "equivalent" rate leaves you poorer than the job you left.
Methodology
Billable hours/year = billable hours/week × working weeks/year
Minimum hourly rate = required revenue ÷ billable hours/year
This gives your floor — the rate below which you cannot hit your target. Sensible freelancers then add margin: a buffer for late payments and dry spells (10–20% is common), plus the value of lost employee benefits. Note this calculator works from a gross target; income tax and social charges still come out of the result, so use a target comfortably above the net lifestyle figure you have in mind.
Worked example
Target €60,000, costs €5,000, 25 billable hours/week, 44 working weeks: required revenue = €65,000; billable hours = 25 × 44 = 1,100; minimum rate = €65,000 ÷ 1,100 = €59.09/hour (€472.73/day). Compare that with the naive €30/hour from salary ÷ 2,000 — the realistic floor is nearly double. That gap is the true cost of freelancing, and it is why experienced freelancers quote day rates, not salary-equivalents.
Frequently asked questions
How many billable hours per week is realistic?
Most freelancers bill 20–30 hours of a 40-hour week; the rest goes to admin, marketing and business development. Beginners often overestimate — 25 is a sane starting assumption.
How many working weeks should I assume?
Start from 52 and subtract holidays (4–6 weeks in Europe), public holidays, sick days and gaps between contracts. 44–46 is typical; 48 is optimistic.
Should I add a margin above the minimum rate?
Yes. The calculated rate is your floor — charge below it and you mathematically cannot reach your target. Add 10–20% for risk (late payers, dry spells) and consider the pension and insurance costs your employer used to cover.
Hourly rate or day rate?
Clients in Europe often prefer day rates for project work. Multiply your hourly floor by 8 — but note that many freelancers discount the day rate slightly (e.g. 7.5× hourly) since full days are easier to fill.
Does this account for tax?
No — it computes the gross revenue your rate must generate. Tax and social charges depend on your country and legal structure; set your target income high enough to cover them.
Last reviewed September 2026